Warning: file_exists(): File name is longer than the maximum allowed path length on this platform (260): C:\zpanel\hostdata\zadmin\public_html\forexbr_com_br/wp-content/cache/supercache/www.forexbr.com.br/2020/05/20/economic-report-ihs-markit-says-latest-pmi-data-indicate-rate-of-collapse-in-u-s-economy-peaked-in-april/meta-wp-cache-598b62b02d1792f3ecfb324e6757277b.php in C:\zpanel\hostdata\zadmin\public_html\forexbr_com_br\wp-content\plugins\wp-super-cache\wp-cache-phase2.php on line 71 Economic Report: IHS Markit says latest PMI data indicate rate of collapse in U.S. economy peaked in April – Forex Brasil

Economic Report: IHS Markit says latest PMI data indicate rate of collapse in U.S. economy peaked in April

Any reading below 50 indicates worsening conditions. The flash estimate is typically based on approximately 85%-90% of total survey responses each month.

What happened: Despite the improvement, service sector and manufacturers reported the second sharpest reduction in new orders since the global financial crisis.

Businesses remained pessimistic about the outlook over the coming year.

The big picture: Manufacturing is expected to stay weak over coming months as the economy gradually reopens, economists say. Auto makers are already experiencing the stop-and-start nature of trying to work during a pandemic.

What IHS Markit said? “Encouragement comes from the survey indicating that the rate of economic collapse seems to have peaked in April. In the absence of a second wave of COVID-19 infections, the decline should moderate further in coming month,” said Chris Williamson, chief business economist at IHS Markit.

What outside economists said? “The unprecedented speed and scale of the coronavirus crisis will probably expose the limitations of surveys like the PMIs. While the composite PMI is now consistent with GDP contracting by around 7% annualised in the second quarter, not much worse than the 4.8% fall in the first quarter, the hard activity data for April suggest the eventual decline could be more like 40% annualized,” Andrew Hunter, senior U.S. economist at Capital Economics.

Market reaction:U.S. stocks turned lower on Thursday amid tensions between the U.S. and China with the S&P 500 Index SPX, -0.67% down 28.52 points in late morning trading.

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