The worldwide PMI surveys signalled the fastest global growth for nearly 1½ years in August led by rebounding activity from COVID-19 lockdowns. The JPMorgan (NYSE:JPM) Global PMI™ (compiled by IHS Markit) rose for a fourth successive month in August, up from 51.0 in July to 52.4 in August, its highest since March 2019. The improved reading indicates a near-3% annual rate of GDP expansion.
The faster growth of global output was accompanied by the strongest monthly rise in new business since January, reflecting firmer client demand. Encouragingly, the rise in new work led to an increase in backlogs of work. Although only marginal, the rise in backlogs hints that global operating capacity was stretched on average for the first time since February. The increase in order books caused more firms to take a more positive view of payroll numbers, with the net loss of jobs in August only marginal and the smallest since global employment began falling back In February.
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