Global orders for business equipment surge at fastest rate in a decade
Worldwide orders for business equipment rose at the fastest rate for a decade in April, as increasing numbers of companies invested in expanding their businesses.
IHS Markit's detailed sector PMI data provide an unparalleled insight into global economic trends by sector, based on information collected from over 28,000 companies each month. The April survey showed new orders for investment goods such as machinery and equipment rising at the sharpest rate since April 2010.
The latest increase represents the tenth consecutive month of rising orders for investment goods following a collapse in demand during the first half of 2020 as the pandemic led companies to cut or postpone investment spending. Over the course of the past year, however, business expectations have improved markedly, in line with successful vaccine developments and vaccination rollouts. Business confidence about the year ahead hit a seven-year high in March, according to the global PMI data, pulling back only very modestly in April and driving a commensurate upturn in investment spending.
While tech equipment manufacturers reported one of the strongest improvements in new orders seen over the past three years during April, the more notable improvement was recorded for other machinery and equipment, which saw the steepest rise in new orders yet recorded by the survey since comparable global data were first available in 2009. Outside of auto manufacturing, these were the fastest growing manufacturing sectors worldwide in April.
Chris Williamson, Chief Business Economist, IHS Markit
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Purchasing Managers' Index™ (PMI™) data are compiled by IHS Markit for more than 40 economies worldwide. The monthly data are derived from surveys of senior executives at private sector companies, and are available only via subscription. The PMI dataset features a headline number, which indicates the overall health of an economy, and sub-indices, which provide insights into other key economic drivers such as GDP, inflation, exports, capacity utilization, employment and inventories. The PMI data are used by financial and corporate professionals to better understand where economies and markets are headed, and to uncover opportunities.
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