Global Economy: Improvement in U.S. & China, Recession in Europe & Japan

Improvement in U.S. and China, Recession in Europe and Japan

Improvement in U.S. and China, Recession in Europe and Japan

Last week was characterized by the PMI (Purchasing Managers’ Indices) published worldwide.

The Global manufacturing PMI rose slightly in December to a level of 49.8.

While the PMI indicates expectations for further industrial expansion in the U.S. and in China, in Europe and Japan it indicates expectations for further economic contraction.

In addition to the PMI, we note below the main data released last week.


Most of the economic data published in the U.S in the past week were positive.

The U.S. labor market data (NFP) for December indicated that the recruitment of workers in the private sector was not affected by the fiscal cliff concerns, as net funding in the private sector was relatively higher than expected.

In addition, the number of orders to U.S. factories (excluding transportation) increased during the past three months at an annual rate of 9.9% (compared with an increase of only 1.2% last year), and the ISM Non-manufacturing increased sharply than expected to its highest level since February 2012.


Economic data coming from the Eurozone continues to point the recession.

The Eurozone final PMI estimate for the industrial sector indicated a slight decrease, to a level of 46.1.

The corresponding index of the service sector actually increased relatively sharply in December to a level of 47.8 (vs. 46.7 in November), which supported an increase in the composite PMI of all sectors in the Eurozone to 47.2 (vs. 46.5 in November).

Despite the increase, the weighted index continues to stay under the threshold of the 50 points for the 11th consecutive month, and its level indicates the expectations for further contraction of the economy in the Eurozone.

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