Global manufacturing activity accelerates

Thursday’s economic data showed that the global economic recovery is continuing, especially in manufacturing.

Bloomberg reports the US data.

Manufacturing grew in March at the fastest pace in more than five years, raising the odds the U.S. has embarked on a prolonged economic expansion.

The Institute for Supply Management’s factory index rose to 59.6, the highest level since July 2004 and exceeding the most optimistic forecast in a Bloomberg News survey of 77 economists. Readings greater 50 signal growth...

Fewer Americans filed claims for jobless benefits last week, the Labor Department also reported. Applications for unemployment insurance payments dropped by 6,000 to 439,000 in the week ended March 27. The average number of claims during the past four weeks fell to the lowest level since September 2008...

Not all the news today was good. Construction spending fell 1.3 percent in February to the lowest level in more than seven years, signaling this part of the economy remains in a recession, figures from the Commerce Department showed. The decrease followed a revised 1.4 percent drop in January that was more than twice as large as previously estimated.

European manufacturing accelerated in March, as Bloomberg reports:

Europe’s manufacturing industry expanded at a faster pace than initially estimated in March as reviving global demand prompted companies to step up output.

A manufacturing index based on a survey of euro-area purchasing managers increased to 56.6 from 54.2 in February, London-based Markit Economics said today. That’s above an initial estimate of 56.3 and the fastest pace since November 2006. A reading above 50 indicates expansion...

In the U.K., the euro region’s biggest trading partner, a manufacturing gauge based on a survey of companies rose to 57.2 from 56.5 in February, Markit and the Chartered Institute of Purchasing and Supply said. That was the highest since October 1994 and above the 56.8 forecast by economists, according to the median of 24 forecasts in a Bloomberg survey.

China's manufacturing also accelerated in March. AFP/CNA reports:

Chinese manufacturing picked up in March, government and HSBC surveys showed Thursday, with the bank saying it could indicate an accelerating economy and raise chances of an interest rate hike.

The HSBC China Manufacturing PMI, or purchasing managers' index, rose to 57.0 last month after falling to 55.8 in February, when the indicator was likely affected by the Lunar New Year holiday.

A separate official PMI published by the China Federation of Logistics and Purchasing (CFLP) showed manufacturing activity rose to 55.1 after slipping to 52.0 in February.

Meanwhile, Japan's business confidence has improved. Again from AFP/CNA:

Japanese business confidence has improved for a fourth straight quarter as the world's number two economy slowly recovers from its worst slump in decades, the Bank of Japan said Thursday.

Sentiment among major manufacturers rose to its highest level since September 2008, with a reading of minus 14 in March from a revised minus 25 in December, according to the bank's Tankan survey of more than 11,000 firms.