Shell Energy Entrepreneurs banner Yudala banner
Global economy rebounds

By Jonathan Cable and Marius Zaharia on 02/09/2017

Share on facebook Yahoo mail icon Gmail icon Share on Google+

Views: 632

•Nigeria’s business hub, Marina Lagos
•Nigeria’s business hub, Marina Lagos

Factories across Asia and Europe cranked up production last month as global demand remained strong, confounding expectations that growth may have peaked.

The strength will add fuel to an expected rollback of monetary stimulus in the West.

Since the global financial crisis, central banks have funnelled trillions of dollars into the world economy.

While policy makers in China and Japan still have their feet firmly on the gas, stronger growth is prompting those in the West to start tapping the brakes on years of super-easy money.

Chinese manufacturing activity accelerated to a six-month high, and eurozone factories stepped up production with the fastest rise in export orders since February 2011.

Even British factory output grew a lot more strongly than expected given the country’s recent Brexit travails.

“Global momentum has turned out to be solid in the first half of 2017 and looks favourable going forward. Generally, we see more reasons for growth optimism than we did three months ago,” said Paul Mortimer-Lee, chief market economist at BNP Paribas.

IHS Markit’s manufacturing purchasing managers index (PMI) for the eurozone rose to 57.4 in August, matching where it was in June, which was the highest since April 2011 and well above the 50-point level that separates growth from contraction.

Along with evidence of slowly rising pricing power for businesses, the data may bolster confidence in the European Central Bank (ECB) to make — and go ahead with — plans to reel back its massive asset purchases programme later this year.

Suggesting Britain’s economy might be picking up speed after a slow first half of 2017, the UK PMI jumped to 56.9, higher than any forecast in a Reuters poll of economists.

That could add fuel to hawkish policy makers’ calls at the Bank of England for higher interest rates.

The BoE’s rate-setters voted 6-2 against a rate hike in August with most policymakers expressing concern about the impact of last year’s vote to leave the European Union on the wider economy.

In the US, the ISM manufacturing PMI is expected to rise to 56.5, though it is likely to be overshadowed by jobs data due later on Friday, expected to show ongoing solid hiring in August but tame wage inflation.

Robust China

China’s private Caixin/Markit survey showed new business grew at the strongest pace in more than three years in August.

The manufacturing PMI rose to 51.6, from 51.1 in July.

That echoed similarly robust official data on Thursday suggesting China’s industrial sector is continuing to prosper from a year-long, government-led building boom. In both cases, economists had expected growth rates to ease.

Prices of industrial commodities and building materials, in particular, have surged in China this year, largely due to the government’s hefty infrastructure spending and its efforts to reduce excess capacity by shutting inefficient mines and mills.

The third quarter is now looking strong enough that China could sustain much of the momentum from its forecast-beating 6.9% growth in the first half, despite a regulatory crackdown on riskier types of financing and debt and a slew of measures to cool its overheating property market.

Resilient growth is not only a boon for the global economy but also for the Communist Party as it prepares for a once-in-five-years leadership reshuffle in October, with stability its key priority.

Ratings agency Moody’s Investors Service this week raised its growth forecasts for China, South Korea and Japan.

“The surveys point to resilient industrial activity last month,” said Julian Evans-Pritchard, China economist at Capital Economics.

But he added: “Investment growth has cooled recently and we anticipate a further slowdown as the impact of tighter monetary conditions continues to feed through. If we are right, the current strength of industrial activity can’t be sustained for long.”

Manufacturing also expanded solidly in the world’s third-largest economy, Japan, as domestic and export orders picked up. The pick-up in new business was generally more modest than in China, however, suggesting its economic growth may moderate from an eye-popping 4% annualised rate in the second quarter.

Other Asian electronics producers were also riding high.

Taiwan’s manufacturing survey saw the fastest growth in four months, while South Korea’s exports beat expectations and posted their longest run of growth in almost six years. South Korea is the first among major exporting countries to publish its monthly trade figures.

India’s activity also unexpectedly rebounded in August, in a sign there was light at the end of the tunnel, with the shock of last year’s demonetisation cash crunch and confusion over a new goods and services tax likely to ease in coming months.

But data on Thursday showed Indian economic growth unexpectedly cooled further to a three-year low of 5.7% in the June quarter from a year ago. (Reuters)

Source News Express

Posted 02/09/2017 12:49:17 PM

 

Share on facebook Yahoo mail icon Gmail icon Share on Google+


 

CLASSIFIED ADS

Loss Off Your Belly Fats, Upper Arm Fat and Body Fats In 2weeks Time.. Click HERE To Start Now!

Let us build the most comprehensive online database of worthy and credible Nigerians from all walks of life. It is worth doing!

 

You may also like...
Violence against children a menace that must be...

Bauchi signs MoU for $200m sugar plant; to...

Kano to provide free daily meals for pilgrims...

N1.64bn Fraud: Court dismisses Ex-Governor Nyame’s no-case submission...

Group tasks FG to respect rule of law,...

Gunmen blow up oil pipeline in Rivers

Customs suspends three senior officers for extortion at...

Notorious top Boko Haram commander killed in encounter...

Russia to establish nuclear centre in Nigeria

Nigeria hires South African mercenaries to battle Boko...

Anambra First Lady lauds Local Government Service Commission...

Reps bemoans deplorable state of South-East roads

 

Latest News 2019 Presidency: Northern leaders shop for consensus candidate •Set criteria for contenders 34,826 dump PDP for APC in Niger Bayelsa set to host the world, as global leaders storm Yenagoa for 2018 Africa SME Roundtable Forum Zamfara killings getting out of hand — IGP Ibrahim Idris Obasanjo opposes Niger Delta leaders’ call for resource control Cows on airport runway: FAAN apologises to Air Peace, passengers VPI: Nigeria soon to decide on observer status, says AGF Trump blames FBI for deadly Florida school shooting Cyber security: The winner takes it all Prof. Akinwunmi’s death a huge loss — Tinubu Peace Corps Bill not dead — NPC Crisis looms in Anglican Church

 

Most Read Nigerian female sex addict opens up, says ‘I like it with both men and women’ (324,687 views) NUDE PHOTO OF OMOTOLA JALADE-EKEINDE surfaces online (316,173 views) Shameless Genevieve Nnaji exposes breasts in public (252,793 views) Finally named: The full list of friends of Nigerian female sex addict who prowled Facebook (207,494 views) Igbo scholar disgraces Femi Fani-Kayode •Demolishes claims on Igbo/Yoruba history with facts and figures (193,954 views) OLUMBA OLUMBA OBU (the one who called himself God) IS DEAD (186,465 views) Breaking News: POPULAR REVEREND CONVERTS TO ISLAM in Kaduna (Nigeria) (162,077 views) OBJ’s son reported dead in Lagos plane crash •Names of more victims emerge (145,436 views) THE FINAL DISGRACE: Igbo scholar unleashes more facts about Igbo/Yoruba history, finishes off Femi Fani-Kayode with second article (139,717 views) Lagos plane crash: Journalist releases victims’ names (128,591 views) My wasted years in Olumba Olumba Obu’s Evil Brotherhood (127,068 views) Gunmen kill ASP, 2 other police officers in vain bid to kidnap Rivers PDP chieftain (122,415 views)

 

Categories Advertorials (3) African Press Organisation (81) Art & Literature (34) Business (2,894) Business Verdict (33) Columnists (802) Complaints & Requests (94) Enterprise & Opportunities (203) Entertainment (442) Features (548) Global Business Monitor (225) International (1,795) Interviews (143) Live Commentary (28) Love Matters (104) News (32,908) Opinion (883) Pidgin (10) Politics (4,500) Religion (676) Sports (1,433) Stock Watch (27) AMA & Al Jazeera Global Update

 

CBN Banner advert

CBN Words on marble

 

 

Football president George Weah puts Liberian army to the test

 

APO Group Partner

 

CLASSIFIED ADS

Let us build the most comprehensive online database of worthy and credible Nigerians from all walks of life. It is worth doing!

Loss Off Your Belly Fats, Upper Arm Fat and Body Fats In 2weeks Time.. Click HERE To Start Now!

GOCOP Accredited Member

GOCOP Accredited member

 

 

Africa Media Agency and Al Jazeera

Advertisement