Manufacturing Orders Slump in Asia, Plunge in Europe
Leading indicator reveals Western economies may be worse than thought
By Mark Russell,  Newser Staff
Posted Jul 2, 2012 1:50 AM CDT
A ship named Ville D'Aquarius is docked at the Port Newark container terminal, Wednesday, June 27, 2012, in Newark, NJ.   (AP Photo/Julio Cortez)

(Newser) – Purchasing Managers' Index reports from Asia and Europe—a critical economic indicator—showed big drops in June, in a strong sign that the economies of Europe and the US could be weaker than thought, the Guardian. Despite European leaders agreeing on a bank bailout scheme last week, Europe's PMI was just 45.1 for a second month in a row (anything below 50.0 indicates a decline), tied for the lowest since June 2009. Greece had the lowest PMI in Europe at 40.1, but Spain's 41.1 was its worst rate in 37 months, and Germany's 45.0 was its worst in 36 months. Great Britain, on the other hand, rose to 48.6 from 45.9, still in decline but closer to expansion.

In China, the PMI fell to 48.2 from 48.4, reaching the lowest point in seven months, reports Reuters. Even the Chinese government-issued PMI, generally more upbeat than private measurements, fell to 50.2, also a seven-month low. "The further decline in the output, new orders, new export orders components suggests that the China economy still faces downside risks in the near term," said a JPMorgan economist in Hong Kong. Japan also fell into negative territory, with 49.9, and South Korea and Taiwan also reported reported a fall in overseas orders.

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