Input Stories

In May, global manufacturing activity contracted for the second consecutive month and at a slightly faster pace, falling from 49.8 to 49.6. For the first time in five months, output fell back into negative territory as a result of declining new orders and export business. Supply chains are stretched despite reduced purchase volumes, with vendor lead times lengthening and delivery times increasing to the greatest extent in six months. Nevertheless, the outlook strengthened, with business optimism rising from April’s two-and-a-half-year low.

India, Greece and Colombia had the highest PMI readings in May, while the Eurozone’s pace of contraction continued to improve for the third consecutive month. On the other hand, China, Japan and the U.K. were some of the larger nations to register declines in activity, and those contractions more than offset activity growth in the U.S. The overall downturn in manufacturing output reflected weakness in the intermediate and investment goods sectors. On the other hand, consumer goods production rose for the 22nd month in a row.

Additionally, manufacturing employment fell for the 10th consecutive month in May but at a slower pace than the prior month. Although staffing levels rose in the U.S., Japan and India, they sank notably in China, the Eurozone and the U.K. While remaining high, both input costs and selling price increases eased to the slowest pace in several months.