ChartBrief 125 – Optimistic If Divergent Global Growth Outlook

ChartBrief 125 – Optimistic If Divergent Global Growth Outlook

The July round of Markit manufacturing PMIs showed an ongoing theme of divergence among the major economies, but an interesting and important link-up between 2 of the major economies.  The developed economies composite PMI showed a slight tick up in July, which was important to see after the softer readings since Feb.  Likewise the emerging markets composite manufacturing PMI also ticked up slightly in July.  Overall on both fronts the synchronized economic upturn that commenced in 2016 has transitioned to a more steady pace of expansion vs further acceleration.

Get The Full Ray Dalio Series in PDF

Get the entire 10-part series on Ray Dalio in PDF. Save it to your desktop, read it on your tablet, or email to your colleagues

Part of the reason for that is the divergent results e.g. for DM: Eurozone 56.6 US 53.3 Japan 52.1 and EM: Russia 52.7 China 51.1 Brazil 50 India 47.9. As you can see it's quite a mix and the trends have been equally mixed.  Yet overall we remain optimistic on the medium term outlook for global growth as the rebound in manufacturing confidence aligns with better global trade activity, rising property prices in the major economies, rebounding industrial production and corporate profit growth, and buoyant consumer confidence.  Further, while the global trend in monetary policy is for tightening/normalization, there remains considerable stimulus in the system, which is clearly benefiting some countries.

After the synchronized upturn in 2016 transitioned to consolidation, divergence remains a theme.

The 3rd Annual 360 Degree Credit Chronometer Report with Joseph Cioffi

CreditValueWalk's Raul Panganiban interviews Joseph Cioffi, Author of Credit Chronometer and Partner at Davis + Gilbert where he is Chair of the Insolvency, Creditor’s Rights & Financial Products Practice Group. In the interview, we discuss the findings of the 3rd Annual report. Q2 2021 hedge fund letters, conferences and more The following is a computer Read More

An important part of the tick up in both EM and DM manufacturing PMIs is the chart below.  It shows an increasingly inter-linked trend between US and China PMIs, and should that tickup turn into an uptrend (not yet) it could shift the global economy into a new period of expansion.


For institutional grade insights on the global economics and asset allocation, and some more good charts you may want to subscribe to the Weekly Macro Themes.  Click through for a free trial.

Follow us on:



Article by Callum Thomas, Top Down Charts

Previous article MIc’d Up – Part 1: A Conversation With John Chambers And Ken Griffin
Next article Has Agile Management’s Moment Arrived?
Topdown Charts: "chart driven macro insights" Based in Queenstown, New Zealand, Topdown Charts brings you independent research and analysis on global macro themes and trends. Topdown Charts covers multiple economies, markets, and asset classes with a distinct chart-driven focus. We are not bound by technical or fundamental dogma, and instead look to leverage any relevant factor to capture the theme. As such, here you will find some posts that are purely technical strategy, some that just cover economics and data, and some posts that use multiple inputs to tell the story and identify the opportunities. Callum Thomas Head of Research Callum is the founder of Topdown Charts. He previously worked in investment strategy and asset allocation at AMP Capital in the Multi-Asset division. Callum has a passion for global macro investing and has developed strong research and analytical expertise across economies and asset classes. Callum's approach is to utilise a blend of factors to inform the macro view.

No posts to display