Brazil, Russia, China and India are meant to represent an engine of growth for the global economy and an “out” for the debt strapped major developed economies of the world. But growth has not been so strong of late and current PMIs confirm the overall weakness.
China’s HSBC Manufacturing PMI fell for the 10 month to 47.6 in August with new export orders falling at the “sharpest rate since March 2009”. Weakening in the service sector PMI pushed the HSBC Composite PMI under 50 to 49.9. Note also weakness in the Japanese, Taiwan and South Korean PMIs. Note also the wider and more important debt and capital investment issues (1,2) which are the key drivers and risks to growth.
The Brazilian HSBC PMI also recorded another sub 50 reading – overall economic data also remains weak with lacklustre Q2 growth. Of note is the large contraction in Q2 exports. Note also a recent Economist article on Brazil.
The Indian HSBC PMI while registering growth, saw a continuation of a declining trend with export orders declining for a second month running. GDP growth has also been weak by India’s standards: 1, 2, 3, 4, 5
A recent Forbes article succinctly discusses many of the BRIC economies’ structural issues.