The economic reports from the US yesterday were all negative. Bloomberg reports:
Manufacturing in the U.S. shrank at the fastest pace in almost five years and construction spending fell the most since 1994 as the economy moved closer to a recession.
The Institute for Supply Management's factory index dropped to 48.3 in February from 50.7 the previous month, the Tempe, Arizona-based group said today... At the same time, the Commerce Department reported that spending on building projects slumped 1.7 percent in January, more than anticipated...
Sales at General Motors Corp., Ford Motor Co. and Toyota Motor Corp., the three biggest auto retailers in the U.S., fell in February from a year earlier, according to industry data issued today. General Motors and Ford each announced deeper reductions in production for next quarter.
Data from the euro area looked a little stronger. The manufacturing purchasing managers' index for February was 52.3, in line with the flash estimate released last month and down from January's 52.8.
Inflation, however, remains a concern, with the input price component coming in at 66.1 from January's 64.8. In addition, the initial estimate of February consumer price inflation in the euro area was reported yesterday as 3.2 percent, unchanged from January and the highest since the euro was introduced in 1999.
It was a similar story in the UK, where the manufacturing PMI actually picked up to 51.3 in February from 50.7 in January. However, also rising were input prices, its sub-index jumping to 72.2 from the previous month's 69.7.
There were conflicting reports on China's manufacturing. The China Federation of Logistics and Purchasing's PMI showed an increase to 53.4 in February from 53 in January but CLSA's PMI showed a fall to 52.8 from 53.2.