Supply Chain Report – Recent Purchasing Managers’ Index (PMI) data suggest that global trade conditions began to stabilise in November after several months of decline. According to PMI surveys compiled by S&P Global Market Intelligence, the Global New Export Orders Index reached the neutral 50.0 level, rising from 48.5 in October. This marks the first pause in contraction following seven consecutive months of weakening global trade activity.
Manufacturing Nears Stability as Services Trade Recovers
November data indicate that international trade in manufactured goods is approaching stabilisation. The Manufacturing New Export Orders Index edged closer to the 50.0 threshold, signalling only a minimal decline in overseas demand—the mildest contraction seen in eight months.
This improvement was largely driven by stronger external demand from mainland China. Following the announcement of a trade truce between the United States and China in late October, Chinese export activity rebounded as trade tensions eased. Manufacturers also cited successful participation in trade fairs and other business development efforts as contributing factors to the rise in export sales.
However, outside of mainland China, global goods exports continued to decline at a slightly faster pace than in October. Slower manufacturing demand and subdued production growth weighed on export performance. Overall new orders grew only marginally, reflecting the fading impact of earlier front-loading activity ahead of US tariff increases earlier in the year. As a result, purchasing activity, hiring, and inventory levels among manufacturers declined further.
Despite these challenges, business confidence among manufacturers improved noticeably in November. Optimism about production over the next 12 months reached its highest level since June, with sentiment strengthening not only in China but also across other regions. This broad-based improvement suggests the potential for better global manufacturing conditions in the year ahead.
Services Exports Return to Growth
Services trade returned to expansion in November after contracting in October. Although growth remained modest, it was the fastest pace recorded in nearly a year and marked only the second expansion since widespread tariffs were introduced in April.
As with manufacturing, mainland China played a key role in the recovery of services exports. Improvements were also reported in several developed economies, including the United States and Australia. Sector-level data showed strong export growth in banking, tourism and recreation, and household and personal-use products. In contrast, healthcare services, metals and mining, and resource-related sectors experienced the sharpest declines in export demand.
Emerging Markets Outperform Developed Economies
Regionally, emerging markets outperformed developed economies in November. Emerging market firms recorded their strongest increase in new export business in nine months, marking the second expansion in three months. While China contributed significantly to this growth, emerging markets excluding China also reported continued expansion for the third consecutive month.
Both manufacturing and services firms in emerging economies benefited from rising overseas demand. Meanwhile, developed economies continued to face declining export activity, extending a contraction that has persisted since mid-2022. Manufacturers in developed markets experienced steeper declines than service providers, with little change from October’s pace of contraction.
India and China Lead Growth in Goods Exports
Among the world’s ten largest trading economies, only India and mainland China recorded growth in goods export orders in November. China replaced Russia as the second economy, alongside India, to post positive export growth. Although modest, China’s export growth rate was the strongest in eight months, supported by renewed international demand and improved business development initiatives.
India also continued to benefit from solid foreign demand, though the pace of growth slowed to its weakest level in over a year due to softer domestic manufacturing conditions.
In contrast, Brazil and Canada experienced the sharpest declines in export orders, largely due to the impact of US tariffs. Canadian manufacturers reported a tenth consecutive month of falling export orders, while Brazil recorded its steepest contraction since June. The UK, Russia, and Japan also posted notable declines, while the US and EU saw milder contractions. South Korea’s goods exports, meanwhile, edged closer to stabilisation.
Outlook
Overall, November’s PMI data point to a tentative stabilisation in global trade, supported by improving sentiment, easing trade tensions, and renewed growth in services exports. While challenges remain—particularly in developed economies—the data suggest that global trade conditions may be approaching a turning point as the year draws to a close.
#GlobalTrade #MarketTrends #InternationalTrade #SupplyChainInsights #GlobalEconomy
