The rate of output growth in emerging markets slowed for the third month running in May, according to the latest survey data from HSBC and Markit. The HSBC Emerging Markets Index (EMI), a monthly indicator derived from the PMI™ surveys, fell to 50.7, from 51.3, the lowest reading since May 2014 and signalling only marginal growth.
Both the services and manufacturing sectors contributed to the overall slowdown in expansion in May. Services output rose at the slowest rate since January, while manufacturing production fell for the first time since April 2014, albeit only marginally. Among the four largest emerging economies, Brazil registered the fastest rate of decline since March 2009. China and India registered the slowest rates of growth in four and seven months respectively.
In contrast, Russia saw private sector activity rise for the second month running, and at the fastest – albeit modest – pace since December 2013. Another weak increase in new business in May suggested that output would remain lacklustre in June.
Moreover, the volume of outstanding business fell for the fourth consecutive month in the latest period. Emerging markets registered a further fall in employment in May, the third in successive months. This marked the longest sequence of job shedding since that which lasted from October 2008 to July 2009.
