WASHINGTON, (Reuters)
FACTORY ACTIVITY across the world fell to its lowest level in almost two years in May, raising concerns about a protracted 'soft patch' in the global economy and depressing long-term interest rates.
Surveys of thousands of manufacturing firms in Europe showed a second consecutive month of falling activity while companies in the United States reported a sharp slowdown in business growth to its lowest level since June 2003.
Only Japan bucked the trend as purchasing managers at manufacturing companies there registered their best performance in eight months on the back of a recovering domestic economy.
A global purchasing managers index (PMI), which aggregates all national surveys and is compiled by JP Morgan, fell to 51.1 from 51.9 in April still just above the 50 level representing the divide between contraction and expansion.
Manufacturing jobs worldwide declined for the first time in 18 months.
"The global manufacturing PMI confirms that the slowdown in world industry deepened in May," said David Hensley, director of global economic coordination at JP Morgan.
"PMI data indicate that manufacturers are trimming stocks of finished goods, with inventory indexes below 50 in the euro area, the U.K., Japan and China," said Hensley.
