One of the world’s top market agencies delivers its verdict on the UK versus the Eurozone its damming for the EU and its zone.
I analyze and consolidate the latest reports from S&P Global and Moody’s, two of the most influential global credit agencies closely monitored by the world’s financial markets. S&P Global is highly regarded for its economic and market research, particularly for Brexit Britain, and has a significant global following. Their insights are widely respected and have a substantial impact on global market trends.
The global verdict on Brexit Britain versus the Eurozone
S&P Global’s report, July 2024
Business growth in the UK is currently outpacing that of the Eurozone. The manufacturing and production sectors are expanding in the UK, while they are contracting in the Eurozone. The Eurozone economy is experiencing stagnation, whereas the UK economy is demonstrating growth.
The all-important PMI Index shows what’s coming
The SP Global PMI Index is widely read throughout the world. It acts as a reasonable barometer of the confidence businesses feel about their prospects and reflects their forward order book.
Below we focus on manufacturing and show the comparison between Brexit Britain and the Eurozone. We chose manufacturing as it is this sector of the UK’s economy on which so many Remainer-Rejoiners choose to comment.
UK versus the Eurozone — manufacturing indices
1. S&P Global PMI Manufacturing Index, July 2024
Eurozone: 45.6 (7-month low)
- Eurozone : 45.6 (7-month low)
- Brexit Britain : 51.8 (29-month high)
[Source : S&P Global PMI Index, 24 July 2024.]
“New export orders (which include intra-Eurozone trade) fell more quickly than total new business as firms in the Eurozone continued to struggle to secure sales from international clients.”
“New export orders decreased for the twenty-ninth successive month”
- S&P Global, Jul 2024
2. S&P Global Manufacturing Output Index, July 2024
- Eurozone : 45.3 (7-month low)
- Brexit Britain : 54.4 (29-month high)
“The Eurozone manufacturing sector was again a key source of weakness. Production was down markedly in July, and to the largest extent in the year-to-date.”
“Manufacturing output continued to decline at the start of the third quarter, extending the current sequence of contraction to 16 months. Moreover, the pace of reduction was marked, having accelerated to the fastest in 2024 so far.”
- S&P Global, Jul 2024
Below are just some of the other comments in S&P Global’s report
1. The UK
- “New business growth across UK private sector jumps to 15-month high”
- “The UK manufacturing sector is enjoying its strongest spell of growth for over two years, with June seeing output and new order growth sustained at robust rates similar to May’s recent highs”
- “The performance of the domestic market remains a real positive, providing a ripe source of new contract wins”
[Source: S&P Global, 24 Jul 2024.]
2. The Eurozone
- “Eurozone economic recovery fades further in July”
- “Provisional PMI survey data signalled a near-stagnation of the eurozone private sector during July as the currency bloc’s economic recovery continued to wane”
- “New orders fell for the second month running and business confidence dropped to a six-month low, leading firms to halt a spell of hiring which began at the start of 2024”
- “Eurozone manufacturing suffers fresh setback in June as production falls at fastest rate in 2024 to date”
- “Headline measure signalled a solid and accelerated deterioration in the health of the Eurozone’s manufacturing sector”
- “Production was down markedly in July, and to the largest extent in the year-to-date”
[Source: S&P Global, Jul 2024.]
One can frequently encounter troubling news about the state of the Eurozone, whether from major economic agencies in the EU or from global economic institutions, as I have quoted from today. The news is not positive.
Despite facing challenges, Brexit Britain continues to outperform its European neighbours. This is particularly notable considering the dire predictions made before the 2016 EU referendum. For example, in 2020, the UK’s GDP growth rate was 1.2%, outpacing the Eurozone’s growth rate of 0.2%.
[ Sources: S&P Global ]
