Global Manufacturing PMI On The Decline…


(CN) CHINA MAY HSBC FINAL MANUFACTURING PMI: 48.4 V 49.3 APRIL FINAL (V 48.7 MAY FLASH)

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(CN) CHINA MAY PMI MANUFACTURING: 50.4 V 52.0E (5-month low; 1st m/m fall in 6 months)

(FR) France May Final PMI Manufacturing: 44.7 v 44.4e (three-year low)

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(DE) Germany May Final PMI Manufacturing: 45.2 v 45.0e

(EU) Euro Zone May Final PMI Manufacturing: 45.1 v

(UK) May PMI Manufacturing: 45.9 v 49.7e

(EU) Euro Zone Apr Unemployment Rate: 11.0% v 11.0%e (fresh EMU record high)

(US) MAY ISM MANUFACTURING: 53.5 V 53.8E; PRICES PAID: 47.5 V 57.0E (lowest prices paid since Dec 2011)

How to interpret these headlines?

We are obviously seeing contraction in the manufacturing sector globally, with new lows being reported out of China and set the tone for the month.  France, UK, and Germany are all showing record low readings, while the U.S. Manufacturing PMI is slightly positive but missed consensus expectation by 0.3.

This is likely to add pressure on the commodities market, which means that Crude Oil, Precious Metals (Gold, Silver, etc…), Copper, etc… are all going to be under tremendous selling pressures as manufacturing slowdown affects demands – (note: earlier report out of China shows that some orders for hard commodities were deferred or cancelled all together due to the slowdown).

Outlook for global recovery remains bearish.  Outlook for commodity currencies, especially AUD, remains bearish as well.

 

FUNDAMENTALS
Forex Weekly Outlook May 22 ~ 26, 2017
Central banks cannot keep pumping cheap credit into series of asset bubbles
China stock market keeps crashing, loses all 2015 gains
Global stocks tumble as Ukraine accuses Russia of invasion
Is Yellen Asking WWBD (What Would Bernanke Do?)
About Henry Liu

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