US economy’s strength highlighted as unemployment rate hits 7½ year low

A mixed report on the health of the US labour market gives frustratingly little new insight into whether the Fed will start to hike rates. The report has been one of the most eagerly awaited so far this year, as it provides a last-minute steer to policymakers mulling over whether to hike interest rates at the FOMC’s 16-17 September meeting.

German PMI rises to five-month high and signals further GDP growth in Q3

Germany’s ‘all-sector’ PMI (a GDP-weighted average of the three surveys’ output measures) rose from July’s 53.6 to 54.7 in August, thereby signalling an acceleration in output growth in Germany’s private sector. The data point to further solid economic growth of 0.5% in the third quarter, after GDP rose 0.4% in the second quarter.

PMI surveys signal steepest economic downturn for 6½ years

China’s economy contracted at the steepest rate for six-and-a-half years in August, according to survey data. The Caixin China Composite PMI (which covers both manufacturing and services), compiled by Markit, indicated the largest drop in output since the height of the global financial crisis in February 2009. The ‘all sector’ output index slipped to 48.8 from 50.2 in July.

UK PMI surveys signal weakest growth for over two years

Even after allowing for the usual seasonal lull in business activity, August saw an unexpectedly sharp slowing in the pace of UK economic growth, which will add to current worries among dovish policymakers at the Bank of England.

Eurozone growth hits four-year high despite stalling French economy

The final Markit Eurozone PMI^® rose to 54.3 in August, up from 53.9 in July, and above the earlier flash estimate. The data signalled the fastest pace of expansion since May 2011.

Brazil’s economy slips into technical recession during Q2

Latest GDP data from IBGE showed that the Brazilian economy registered its worst quarterly performance since 2009 in quarter two, broadly in line with the Markit-compiled PMI data. Worryingly, the PMI suggests that this downturn extended into the third quarter. Output continues to contract across the manufacturing and service sectors, with the country’s economic malaise compounded by high interest rates, stubborn inflation and rising unemployment.

Regional weakness adds to easing of Vietnamese manufacturing growth

Growth of manufacturing output in Vietnam eased to the slowest for ten months in August, according to the latest Nikkei PMI survey, compiled by Markit. This continued a trend of generally weaker expansions seen since the survey’s record high in May. The slower rise in output was matched by new orders, as new work appears more difficult to secure than it was earlier in the year. This is particularly the case in international markets as companies reported a third successive monthly fall in new export orders.