The rate of global economic expansion slowed again in August.
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The J.P.Morgan Global Composite Output Index – which is produced by J.P.Morgan and IHS Markit in association with ISM and IFPSM – posted 53.4, down from 53.7 in July to its lowest reading since March.
Service sector business activity increased at the weakest pace in five months, as rates of expansion moderated across the business, consumer and financial services categories.
In contrast, growth of manufacturing output improved slightly, as faster increases at consumer and investment goods producers more than offset slower expansion in the intermediate goods category.
Economic activity rose in almost all of the nations for which all-industry PMI data are compiled.
The sole exception was a contraction in Brazil, where a solid decrease in services activity contrasted with stronger growth at manufacturers.
The US remained the main driver of global economic expansion during August, despite seeing its rate of increase dip to a five-month low.
Output growth strengthened in the euro area, Japan, the UK and Russia, but slowed in China, India and Australia.
The level of new business increased again in August, extending the current sequence of growth to 110 months.
However, the rate of expansion eased to its weakest since April 2017, as new order growth ticked lower in both the manufacturing and service sectors.
The overall increase was sufficient to test capacity, as highlighted by backlogs of work rising for the twenty-fifth successive month.
The ongoing expansion of global economic activity encouraged companies to increase employment in August.
Although the pace of job creation eased to an 11- month low, it remained above its long-run average.
Staffing levels were raised in the US, the euro area, Japan, the UK, India and Australia.
Cuts were seen in China, Brazil and Russia.
August saw further increases in input prices and output charges.
The rate of selling price inflation remained close to July’s joint-survey record, as companies acted to pass on higher costs to clients to protect margins.
Although the rate of increase in input prices was the slowest in three months, it remained above its long-run average. ■