Global manufacturing PMI reaches five year high in May

Global manufacturing activity accelerated sharply in May, reaching its highest growth rate in nearly five years, according to widely watched industry surveys. The expansion was driven by companies rushing to build inventories and secure supplies ahead of anticipated price increases and shipping delays stemming from the ongoing conflict in the Middle East.

The Global Manufacturing Purchasing Managers’ Index recorded its sharpest rise in worldwide factory production since July 2021. National surveys showed particularly strong growth in several major economies. In the United States, output growth hit its highest level in just over four years, while Japan saw some of its largest production gains since early 2018. In the United Kingdom, the manufacturing PMI rose to 53.9 in May, marking the fastest pace of growth in four years. Similarly, Ireland’s manufacturing sector grew at its fastest pace in four years, with its PMI rising to 55.9.

Economists attribute the surge to businesses frontloading purchases to mitigate expected war-related disruptions. The number of manufacturers building safety stocks has risen over the past two months to the greatest extent since similar stockpiling...