Following July's drop in US Manufacturing PMI (and biggest miss in 11 months), August's Flash print hit 58.0 - its highest since April 2010, beating expectations of 55.7 and up from the 55.8 July final print. With China (biggest PMI miss on record) and Europe (13-month low PMI) both disappointing, the world needed some help and the US 'soft' survey offered it up in spades... Production levels surged, employment rose at the fastest pace since March 2013, and new orders picked up once again. This was the biggest beat on record - well above even the highest economist's estimate. Mission Accomplished...
Biggest beat on record - well above even the highest economist's estimate.
To April 2010 highs...
Well above even the highest economist estimate...
Highlights from the report:
- Manufacturing PMI rebounds sharply from July’s three-month low
- Output and new orders both rise at faster rates
- New export business increases at steepest pace for three years
- Employment growth accelerates to strongest since March 2013
And as Markit concludes:
“Overall, with job hiring gathering momentum and input buying expanding at the sharpest pace for at least seven years, it seems US manufacturers are increasingly confident that the recovery is firmly back on track and are gearing up for a sustained rebound in production schedules over the months ahead.”
So job done Fed, or will Yellen continue pointing out all those weaknesses we first observed in 2010 (part-time jobs, no wage growth) as the alibi for the Fed to continue pumping stocks to higher record highs before it is content that it's job here is done? More color tomorrow when Yellen speaks.
Charts: Bloomberg and Markit