THEEurozone have you finished braking? Start restarting? Reading the economic coffee grounds, looking for at least weak signals that 'a nuttata it has passed, it provides us with some consolation but warns that it is too early to rejoice.
The increase of orders to industry Germany in September (+1,3% on August) was hailed as a revival. Also because it crossed with the ascent of the manufacturing PMI. Indeed, the rate of contraction is less severe in October (45,9 from 45,7 in September; 50 is the watershed). But always of very marked contraction it is and if the Germany he is a little less worse, the countries that crown his industry (Poland, Spain, the Netherlands, Italy, Czechia) have accentuated, often greatly, the decline.
Something similar has been observed around the China, which in October saw manufacturing conditions improve at the fastest rate since February 2017, also thanks to orders from abroad. But they have worsened, sometimes significantly, in South Korea, Vietnam, Indonesia, Taiwan, Thailand and Japan.
- Use they also recorded progress in the manufacturing activity indicator, both in the Markit and ISM versions, although the former is expanding and the latter is contracting (but foreign orders have stopped falling). This time coupled by as many increases in Canada and Mexico.
If we add i services to the picture, the tints remain rather bleak in the Eurozone. In fact, the tertiary sector recorded an increase in the PMI index in October (to 52,2 from 51,1), however remaining at the lowest levels from January. And the sum of the two sectors suggests that the area's economy is stuck at the lowest growth rate since the sovereign debt crisis. With Germany still in recession, Italy stagnating, Spain holding back and France acting as a locomotive (not high speed train, rather steam). What is worse is that orders, i.e. future production, are down, with a marked fall in foreign orders.
Colors that don't become more rosy by enlarging the gaze to the whole global economy. At the opposite. Because if there is stabilization at low levels in Europe, although there is still no sign of a restart, in the world the PMI index has fallen again and has reached its lowest levels since February 2016, with the first reduction in employees for a decade. Orders are rising at the same slow pace as output, so they don't indicate a forthcoming trend reversal.
On the other hand, in the third quarter of 2019 the world trade it is on course for a rebound, after three consecutive declines (but it is -0,9% on a year earlier). Industrial production records zero variation, ie the worst since the fourth quarter of 2012; in Germany the fall continued also in September (-1,3% on a monthly basis, -4,6% on an annual basis), while in France it rose again by 0,6%, but along a trend that was more yielding than stagnant.
The imminent will suffice China-US agreement on trade to put back into the bottle the evil genius of uncertainty that the trade war has unleashed? It is doubtful. Democratic candidates for the White House for the 2020 elections also speak of competitive ground to be leveled. Sure, Trump's crude ways of raising rates from night to day are a major political risk-taker.
For now, the October data of the world's largest exporter and importer, China, indicate that the flows of exchanges with foreign countries are still in contraction, albeit less intense than in the previous months.
In these international seas theItalian economy stays afloat. Activity stagnates. After +0,1% in the third quarter, GDP started the fourth quarter with slight progress: in October the composite PMI rose to 50,8, from 50,6, thanks to services, given that manufacturing has some ' made the contraction worse. The support definitely comes from consumption, even if the boost from basic income is running out, because its spending represents a step in purchases (+0,3% the volume of retail sales in the summer). Car registrations are on the rise, after the decline between the end of 2017 and the end of 2018.
Il job market, however, is beginning to feel the effects of the usual delay of economic trends. Job creation stopped in September and unemployment increased. Families remain positive, but start to perceive uncertainty for the months to come: a good explanation of the increase in the propensity to save. On the other hand, the reduction in interest rates leads to renegotiating mortgages (subrogation) and freeing up resources.
It is precisely the low interest rates that give new impetus to construction, which are recovering from the blow of the crisis, thanks a little more to public works. On the other hand, it is par excellence the sector most sensitive to monetary conditions, which have never been so favourable.
