Eurozone March final manufacturing PMI 44.5 vs 44.8 prelim

Andrew Cummings
April 2, 2020

The U.S. manufacturing sector contracted in March, with activity hitting its lowest level since 2009, as the coronavirus pandemic caused widespread shortages, a survey confirmed on Wednesday.

Analysts polled by Reuters had expected the official PMI to come in at 45 for the month of March.

"The manufacturing sector was knocked sideways by the impact of Covid-19 and into contraction territory, experiencing some of the most challenging trading conditions since PMI records began", Mr Brock said.

"The index is all but certain to sink next month, though a few industries are likely to hold up surprisingly well because of an increase in demand for products such as toilet paper, sanitizer and other consumer goods in short supply", MarketWatch said.

Many warn that manufacturers and overall economic activity will remain under intense pressure in coming months in light of the rapid spread of the virus across the world, the unprecedented lockdowns in several countries and the nearly near certainty of a global recession.

The findings, which focus mostly on small and export-oriented businesses, lagged an official survey released on Tuesday, which showed factory activity expanded at a faster pace on a month-on-month basis. London's FTSE 100 (^FTSE) fell by more than 3.5%.

Yet, the pace of business resumptions has been constrained by China's efforts to guard against a second wave of infections from overseas. It slipped into contraction from a reading of 51.7 in February. Supply delays are normally seen as a sign of rising demand, but at the moment near-record delays are an indication of global supply chains being decimated by factory closures around the world.

Already, Chinese exporters are seeing overseas orders being scrapped as the worldwide spike in coronavirus infections and deaths has forced numerous nation's trading partners to slow or suspend production.

USA manufacturing activity in March fell at its fastest pace since August 2009 as the coronavirus outbreak in the US has battered businesses. Globally the outbreak has claimed the lives of over 34,000 people with more than 720,000 infections.

It said concerns that the global Covid-19 pandemic would have a long-lasting damage resulted in sentiment falling to its lowest level since January 2016.

The figure was also well below the 50 mark that separates expansion from contraction.

Meanwhile, the ADP's monthly National Employment Report showed that the private sector employment in March declined by 27K in the US.

With all businesses closed bar those deemed essential to the country's supply chain, and draconian restrictions on people's freedom of movement, economists forecast a steep GDP decline this year.

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