US: Manufacturing PMI likely to post a gain in March – Danske Bank

In the US, PMI manufacturing for March is due out today and analysts at Danske Bank suggests that given that Markit PMI was significantly below the level suggested by ISM and Empire in February, one could be tempted to call for an increase in PMI manufacturing in March in order to close part of this gap.

Key Quotes

“However, it is worth keeping in mind that manufacturing activity has been increasing since last summer, partly on the back of a recovery in the oil market. Without further increases in the oil price, the given level is probably as high as we are going to get. Also, there are signals of a deceleration in economic growth in Q2 this year, which should also cap growth in the manufacturing sector. Thus, we expect manufacturing PMI to stay around the current level. This continued improvement in manufacturing should also spill over into core capital goods orders for February, which is due out today as well. Both new orders and value of shipments bottomed out in mid-2016 and we expect them to move higher in coming months.”