Today we had the first glimpse of Markit's October PMIs for Japan, Germany, France, UK and US, with prelimninary reading for both manufacturing and services sectors.
As always with the Markit's PMIs, its a struggle to drag anything of genuine substance out of them, but maybe there is some genuine information hiding in the broad sweep of the conclusions. Anyway, averaging the movements in all these economies, there was a very slight acceleration in manufacturing expansion in October vs September, with the average rising to 52.7 from 52.4 in September. But the divergence between countries widened a bit, with the standard deviation rising to 3.7pts from 3.4. The main reason for both those features is an acceleration in Germany, where the PMI rose 1.6pts to 58, with the output index up at 64.9, the best since Feb 2011! Elsewhere, there's no change in pattern: Japan is still contracting but we've got mild expansions elsewhere.
For services, there's a slight slowdown with the average falling 0.3pts to 50.9 - a much more fractional expansion than manufacturers are having. Once again, there is a greater divergence between economies, and once again, it's Germany that's responsible. It's services PMI fell 1.7pts to 48.9, the weakest since June. Germany fared unusually well in the first wave of Covid, but seems to be sharing the same panic as the rest of Europe this time round.
The other thing that stands out is there's a clear split between on the one hand Japan and continental Europe, which are all showing service sector contraction, and the US and UK, where servies are not only expanding, but actually accelerated slightly in October.
