Global manufacturing rebounded in August, with output, new orders and employment all edging back into growth territory. The global manufacturing PMI climbed above the neutral 50 mark to 50.9, signalling the strongest operating conditions since mid-2024. Production growth hit a 14-month high, driven particularly by consumer and investment goods, while intermediate goods recorded more modest gains. Out of 32 nations, only five reported lower output, with India, Thailand, Spain, Colombia and the US emerging as bright spots, even as Poland, Taiwan and Brazil lagged.

Encouragingly, global employment expanded for the first time in over a year, though gains were fragile and uneven across sectors. New orders improved, but international trade remained subdued as tariffs weighed on export flows. Price pressures also resurfaced, with input costs and output charges accelerating, most sharply in the US. Capacity pressures eased slightly, and inventories broadly stabilised, suggesting some balance between supply and demand.

While the headline numbers point to momentum, sentiment remains muted. Optimism stayed below the long-run average for the seventeenth consecutive month. August's uptick marks progress, but the global manufacturing sector remains vulnerable to trade frictions and inflationary risks.

J.P. Morgan Global Manufacturing PMI gives an overview of the global manufacturing sector. It is based on monthly surveys of over 10,000 purchasing executives from 32 of the world’s leading economies, including the U.S., Japan, Germany, France and China which together account for an estimated 89 percent of global manufacturing output. It reflects changes in global output, employment, new orders and prices. The Global Manufacturing PMI is seasonally adjusted at the national level to control for varying seasonal patterns in each country and is produced by J.P. Morgan and Markit Economics in association with ISM and the International Federation of Purchasing and supply Management (IFPSM).

Investors need to keep their fingers on the pulse of the economy because it dictates how various types of investments will perform. The J.P. Morgan Global Manufacturing PMI provides advance insight into the global manufacturing sector, which gives investors a better understanding of business conditions and valuable information about the economic backdrop of global markets. The stock market likes to see healthy economic growth because that generally translates to higher corporate profits. The bond market prefers less rapid growth and is extremely sensitive to whether the economy is growing too quickly and causing potential inflationary pressures. The PMI data are also used by many Central Banks to help make interest rate decisions.

The J.P. Morgan Global Manufacturing PMI data give a detailed look at the manufacturing sector including the pace of manufacturing growth and the direction of growth for this sector. Since the manufacturing sector is a major source of cyclical variability in the economy, this report has a big influence on the markets. In addition, its sub-indexes provide a picture of output, employment, new orders and prices.