The incipient recovery in global manufacturing that began in Q4:2022 has effectively rolled over and died over the past few months. The most recent G4 flash manufacturing PMI New Orders data have fallen back to a new cycle low (42.7 vs 44.7 last month and 43 in December last year). That's the lowest reading since COVID and the GFC and has reversed much of but not quite all of the surge in output expectations that occurred last Autumn. China, meanwhile, has also seen manufacturing New Orders fall back a little after the first quarter bounce. Japan is a partial exception to this trend: even though new orders dipped slightly last month they remain well above the most recent cyclical low.
Service sector activity, meanwhile, may be rolling over. Non-manufacturing New Orders in the G4 dropped from 54.4 in May to 53.7 in June. Other than the US, the rest of the G4 saw services activity decelerate (Figure 3).
If Services activity really has peaked and follows the lead of manufacturing (which it typically does), global growth momentum is about to turn down again after a brief stabilisation.