New data has just revealed that the manufacturing sector in Mexico and China is beginning to pick up again.
However, last month also represented the first time that output contracted in India since March 2009.
According to a new survey, the HSBC Mexico Manufacturing Purchasing Managers’ Index (PMI) increased from 49.7 in July, to 50.8 in August.
In addition, China’s official purchasing managers’ index (PMI) of manufacturing reached a year high of 51.0, compared to 50.3 in July.
Any figure above 50 means growth and anything below indicates contraction.
Sergio Martin, Chief Economist at HSBC Mexico, said:
“We maintain our view that the economy will gain momentum [in the second half of 2013], although at a slower pace than expected previously.”
There has been lower U.S. demand for Mexican exports this year as a result of less government spending. Factory exports account for about 25 percent of Mexico’s growth domestic product (GDP).
The Mexican economy recently contracted – for the first time in four years – but the country’s finance ministry has said that they expect the economy to pick up in the second half of the year.
The HSBC India Manufacturing Purchasing Managers’ Index fell from 50.1 in July to 48.5 in August. This represents the fourth month of declines. Economic growth in India has slumped to 4.4% annual rate during the second quarter of this year, its slowest performance in four years.
There is much more confidence in global economic growth, according to a recent Bank of America’s Merrill Lynch Fund Manager Survey, which included a total of 180 managers, managing over US$516 billion.
In addition the economies of emerging markets are likely to improve, according to strategists and emerging markets debt portfolio managers at Neuberger Berman -one of the leading employee-controlled money managers.