Wednesday, 2 May 2012

China and US manufacturing PMIs rise, Australian interest rates slashed

Tuesday's economic reports showed that the world's two main growth engines appear to have done well in April.

The China Federation of Logistics and Purchasing reported on Monday that its manufacturing PMI rose to 53.3 in April from 53.1 in March.

US manufacturing also accelerated in April, the Institute for Supply Management’s manufacturing PMI rising to 54.8 from 53.4 in March.

The news was not as good for US construction spending, which rose just 0.1 percent in March after falling 1.4 percent in February.

Meanwhile, the UK economy looks like it will struggle to come out of recession. The Markit/CIPS manufacturing PMI fell to 50.5 in April from 51.9 in March.

Australia's manufacturing PMI fell even more alarmingly by 5.6 points to 43.9 in April. And with house prices falling 1.1 percent in the first quarter, the Reserve Bank of Australia must have felt compelled to cut interest rates by 50 basis points to 3.75 percent in its monetary policy meeting on Tuesday.

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