Life in the Slow Lane
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How are the latest global PMI trends reflecting the state of the world economy?
Well we've had PMIs that weren't styling, some small moves up, some small moves down, but nothing to suggest the global economy is improving at any significant rate, or indeed going backwards. Nonetheless, central bankers seem to be talking down the speed of cuts. In particular, New Zealand's Governor or should we write off a fifty basis point cut from them, let alone a seventy-five basis point cut? The UK Chancellor has found a way to invest fifty billion pounds extra in their budget next week. And Trump pushing further ahead in the polls. It's Friday. It's the 25th of October, 2024. It's the morning call from Nab. Good morning. Well, today for a change, the US dollar has actually lost value down 0.4% on the DXY, but that's not been reciprocated by the Aussie, which is up just 0.1% to 66.4 US cents.
The pound and the euro are both up 0.4%, and the yen is up 0.6%. And bond yields are falling, uh, with one or two exceptions. So ten-year treasury is down four basis points, down four for ten-year yields in Germany and France as well. But the UK, they are up four basis points. And Aussie yields were down one basis point for ten years yesterday to four point four five percent, down a couple more on futures since then. And US shares are somewhat mixed at the close, so the Dow is down a third of one percent, a 0.2% rise. In the SP, its first rise of the week, and a 0.8% rise in the Nasdaq, helped by Tesla, of course, which is up twenty-two per cent today, and the Russell 2000 finishing up a quarter percent at the close as well.
Europe is largely in the green, up 0.3% for the Eurostox fifty and the DAX. And oil down further today, half percent off WTI, 0.4% off Brent, down to 7470 a barrel now. So let's have a look at the Look at uh PMIs, first of all.
What do the recent PMI numbers reveal about US, Europe, and UK economic health?
The uh the title of this episode I think says it all, Life in the Slow Lane. Uh Nabs Ray Achel joins me. He knows what song I'm talking about, don't you? You you're old enough to remember the I've changed it around a little bit, but uh you know the Eagles song. Absolutely do. Absolutely do. Good morning, Phil. Happy Friday. I was gonna I was gonna quote from I was gonna c I was gonna say Ray Achwell has a nasty reputation as a cruel dude. They said he was ruthless, they said he was crude, but then I thought I'd better not go on to the next line 'cause it gets a bit saucy after that. But
anyway,
let's
when people read my daily note rather than the podcast, they've got a bit of Rolling Stones just to uh
Oh right, okay, there we are. So PMIs for Europe, first of all, the UK included, I mean they w they did undercut our expectations, didn't they, except uh a couple of exceptions. Uh the manufacturing number, that's up to fift forty five point nine for the Europe wide number, but that is uh that's still contracting. It's just c contracting a little less quickly. So there's nothing to get excited about in these numbers at all, is there?
Well, other than uh very mixed signals, the fact that okay, Germany's still deep in contraction territory, but things aren't getting worse.
Why is the Eurozone economy appearing flat and moribund according to the latest data?
So I think that uh you know in terms of the overall Eurozone signal, yes, it's pretty flat and pretty moribund as you say, and and France was the main reason really that um the numbers didn't do better. So you know, France has been clearly outperforming Germany. Um but that uh it's certainly but his crown has certainly slipped as far as the last month is concerned, but the um the PMI um masters uh are noting that some of the other countries, uh Spain in particular, are doing well. So that sort of held up the overall um PMI readings, but um you know you contrast that with the US and you know clearly US exceptionalism, particularly when it comes to the service sector, still rains.
And the UK, uh well actually their services PMI is down, still growing, but down from fifty two point four uh to fifty one point eight, which is more than expected, and uh manufacturing slipping from fifty one point five to fifty point three. So uh yeah, the crown in the UK not looking quite as shiny either, is it?
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Chapters
8 chapters
1
How are the latest global PMI trends reflecting the state of the world economy?
0:00–1:43
2
What do the recent PMI numbers reveal about US, Europe, and UK economic health?
1:43–2:46
3
Why is the Eurozone economy appearing flat and moribund according to the latest data?
2:46–5:58
4
How will the UK Chancellor’s extra £50 billion investment impact the economy and markets?
5:58–8:27
5
What is the RBNZ’s stance on rate cuts and services‑inflation stickiness?
8:27–10:05
6
What does the US manufacturing PMI indicate about contraction and future growth?
10:05–12:05
7
What does the latest University of Michigan consumer sentiment suggest for US consumer outlook?
12:05–13:26
8
What insights does John Barron offer on a potential Trump presidency and its global implications?
13:26–14:59