Global manufacturing is in a recession

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The global economy is sounding alarm bells as the manufacturing Purchasing Managers’ Index (PMI) continues to contract. With major economies like the U.S., China, and the Euro Area all witnessing a dramatic slowdown, the manufacturing sector is teetering on the edge of crisis. The Euro Area’s PMI plunged to a staggering 45.0 in September, an unmistakable sign that the industry is shrinking, not growing. As demand withers and economic uncertainty looms, the ripple effects are becoming painfully clear. Geopolitical tensions and unrelenting supply chain disruptions only intensify the chaos, driving manufacturing activity to dangerous lows.

This chilling trend is now global, with September 2024 marking the third consecutive month of contraction for the PMI. Worse yet, new export orders have plummeted at the fastest rate seen in 11 months. The rapid erosion of global trade is unmistakable; the wheels of commerce are grinding to a near halt, spelling disaster for manufacturers worldwide. A year-over-year decline in global trade volumes by 3-4% is now expected—the steepest drop since the COVID-19 pandemic devastated the global economy.

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If these patterns hold, the ramifications could be catastrophic. Manufacturing is the heartbeat of the global economy, and its failure could send shockwaves through industries, erasing jobs and sparking financial turmoil. With global trade volumes set to experience their most substantial decline in years, the warning signs are impossible to ignore.


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Sources:
https://www.fastcompany.com/91200693/global-manufacturing-hit-slump-heres-why

https://www.qnb.com/sites/qnb/qnbglobal/en/eneconomic15oct2023news