Manufacturers across Europe ended 2020 on a high while Asian factory activity expanded moderately thanks to robust demand in regional giant China, surveys showed, but the prospect of tougher coronavirus curbs clouded the outlook for the recovery.
Despite hopes that vaccination programmes being rolled out will eventually quell the virus, a resurgence of infections is forcing many countries to reimpose strict controls on economic activity, possibly hurting large exporters such as China and Germany.
Global manufacturing was still on a roll until the middle of December which is a very good basis for an economic rebound once the current wave of the pandemic subsides, said Holger Schmieding at Berenberg.
We may have a modest setback in January as renewed lockdowns affect manufacturing but with China remaining fairly strong and the U.S. not showing significant signs of a consumer slowdown the outlook for manufacturing is still good.
Activity in euro zone manufacturing increased at its fastest pace since mid2018 last month, suggesting the blocs economy was less hard hit by the pandemic than earlier in the year.
IHS Markits final euro zone Manufacturing Purchasing Managers Index PMI rose to 55.2 in December from Novembers 53.8, although that was below the initial 55.5 flash estimate.
Anything above 50 indicates growth, and December was the highest reading since May 2018. An index measuring output, which feeds into a composite PMI due on Wednesday that is seen as a good…