Global economic activity has slowed

Sources: Bloomberg and Wells Fargo Investment Institute. Monthly data from April 1, 2019 to March 31, 2022. PMI = Purchasing Managers’ Index. U.S. Composite Purchasing Managers’ Index level is the Institute for Supply Management Composite Index®, which is a composite index based on the diffusion Indexes of five of the Indexes with equal weights: new orders, production, employment, supplier deliveries, and inventories. Eurozone and China PMI levels use the Markit Manufacturing PMI Index, which is an index developed from monthly business surveys used to monitor the condition of industries and businesses. An index value over 50 indicates expansion; below 50 indicates contraction. The values for the index can be between 0 and 100.

Key Takeaways

  • The U.S. is maintaining its role as the global growth locomotive because it is better insulated from war-related disruptions to supply and supply-chain issues.
  • Global manufacturing’s healthy recovery likely will be tested in the coming months by fallout from the pandemic, particularly in Asia, and by war-related disruptions.