Good news for manufacturing?

Posted by: Paul Donovan

01 Apr 2019
  • There are indications that global trade has stabilized, with freight rates for smaller ships increasing. This may reflect increased demand for goods' transport. There are still some near-term risks – one being that US companies may try to delay imports in the hope that President Trump's taxes on US consumers of foreign goods will be lifted soon.
  • Japan's Tankan business sentiment survey showed weaker manufacturing sentiment. Sentiment is generally influenced by the media news cycle. Sensationalism in media is poorly filtered. Media reporting of the trade tensions has an impact. However, capital spending plans were better than expected. Capital spending was a major driver of weaker growth globally late last year.
  • More sentiment opinion polls are due in Europe, where the German numbers will be watched (today's data are revisions). A drop in the German PMI is more likely to be revised higher than lower in the final numbers. The US ISM manufacturing sentiment poll is also due, as are US retail sales.
  • In the UK, Parliament takes "control" of the EU-UK divorce, with indicative votes (again) which the government can ignore (again). There is talk of another vote on the government's plan, the previous three having been such fun.

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