July 2025 Monthly PMI Bulletin: S&P Global Economic Activity Update

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Global economic Expansion Gains Momentum, Fueled by Manufacturing Resurgence

June 15, 2024

The global economy showed a notable acceleration in its expansion during June, marking a positive turn supported by a robust resurgence in manufacturing production. This encouraging trend offers a beacon of optimism for businesses and consumers alike, suggesting a stronger economic outlook.

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Manufacturing Sector Leads the Charge

A key driver behind the global economic expansion’s acceleration this past month has been the manufacturing sector’s renewed vitality. Reports indicate a broad-based increase in production output across various industries.This manufacturing revival suggests improved supply chain efficiency and a potential increase in consumer and business spending.

the uptick in manufacturing activity is a crucial indicator, often reflecting underlying demand and investment. It signals that businesses are increasing output to meet anticipated sales, a healthy sign for overall economic health.

“Did You Know?” While manufacturing often leads economic cycles, service sector growth remains critical for sustained, broad-based economic health and employment.

Key Economic Indicators on the Rise

Beyond manufacturing, other economic indicators are also pointing towards an upward trajectory. Increased manufacturing production typically correlates with higher employment rates and greater investment in capital goods. This creates a positive feedback loop, further stimulating economic activity.

Analysts are closely watching how this momentum translates into broader economic metrics. A sustained increase in manufacturing output can lead to more stable pricing and a reduction in inflationary pressures, although current global conditions remain complex.

Pro Tip: For investors, tracking manufacturing PMI (Purchasing Managers’ Index) data can provide early signals of economic shifts. Consider exploring resources from organizations like the Institute for Supply Management (ISM) for detailed insights.

Comparative Economic Performance

The recent acceleration suggests that the global economy is outperforming earlier projections.Different regions are experiencing this growth at varying paces, but the overall trend is undeniably positive.

Key Economic Drivers in June Expansion

Sector/Indicator	Trend	Impact
Manufacturing Production	Renewed Rise	Primary growth driver
Supply Chains	Improving Efficiency	Facilitates higher output
Employment Rates	Potential Increase	Boosts consumer spending
Investment in Capital Goods	Likely Growth	Signals business confidence

Looking Ahead: Sustaining the Momentum

The path forward will depend on whether this manufacturing-led expansion can be sustained and broaden across other sectors. Factors such as consumer confidence, geopolitical stability, and monetary policy will play crucial roles in shaping the remainder of the year.

This June’s economic acceleration provides a hopeful outlook. As businesses and policymakers navigate the current landscape, understanding the nuances of this manufacturing resurgence is key to fostering continued global economic prosperity.

Understanding Global Economic Expansion

The global economic expansion is a complex phenomenon, influenced by a myriad of interconnected factors. A key metric frequently enough used to gauge this expansion is the Purchasing Managers’ Index (PMI), which provides insights into the health of the manufacturing and services sectors. A PMI above 50 generally indicates expansion, while a reading below 50 suggests contraction. For detailed details on PMI, the S&P Global website offers complete data and analysis.

When manufacturing production rises, it frequently enough signals increased demand for raw materials, greater employment

What is the relationship between the Global composite PMI and the overall economic expansion, as indicated by the July 2025 data?

Global Manufacturing & Services Performance – July 2025 Overview

The latest S&P Global Purchasing Managers’ Index (PMI) data for July 2025 paints a complex picture of the global economy. While manufacturing continues to show signs of stabilization, the services sector remains the primary driver of growth, albeit at a moderating pace. This bulletin provides a detailed analysis of the key findings, focusing on regional variations and sector-specific trends. Key indicators include manufacturing PMI, services PMI, composite PMI, new orders, output, employment, input costs, and selling prices.

Key Highlights – July 2025 PMI Data

Global Composite PMI: Registered at 53.8, down from 54.2 in June, indicating a slowdown in overall economic expansion. This marks the weakest growth as February 2024.

Manufacturing PMI: Remained stable at 50.5, signaling a marginal improvement in factory conditions. New orders showed a slight increase, but output growth remained subdued.

Services PMI: Moderated to 54.3 from 55.1 in June, reflecting a cooling of demand in the service sector.This slowdown was particularly noticeable in consumer-facing industries.

US PMI: The US composite PMI edged down to 52.0, with both manufacturing (50.8) and services (52.4) experiencing slower growth. Inflationary pressures remained a concern, with input costs rising at an accelerated rate.

Eurozone PMI: The Eurozone saw a more pronounced slowdown, with the composite PMI falling to 52.5. Germany’s manufacturing sector continued to struggle, while france showed more resilience.

asia-Pacific PMI: China’s PMI data showed a positive trend, with both manufacturing (51.2) and services (53.5) expanding at a faster pace. Japan’s PMI remained relatively stable, while India continued to be a growth leader.

Regional Breakdown: PMI Performance in July 2025

United States – Economic slowdown & Inflation Concerns

The US economy experienced a deceleration in growth during July 2025. While the services sector continues to outperform manufacturing, the rate of expansion has slowed.Input prices rose sharply, driven by energy costs and supply chain disruptions, contributing to persistent inflation. Employment growth in the service sector remained positive, but manufacturers reported a slight decline in staffing levels. The Federal Reserve’s monetary policy decisions will be crucial in navigating this period of slowing growth and elevated inflation.

Eurozone – Divergent Performance & German Weakness

The Eurozone’s economic performance was characterized by meaningful divergence.Germany’s manufacturing sector remained in contraction, weighed down by global trade headwinds and high energy prices. France, however, demonstrated greater resilience, with both manufacturing and services sectors showing modest growth. The European central Bank (ECB) faces the challenge of balancing the need to control inflation with the risk of triggering a recession. Business confidence in the Eurozone remained subdued.

Asia-Pacific – china’s Recovery & India’s Momentum

The Asia-Pacific region presented a more optimistic outlook. China’s economy continued its recovery, driven by strong domestic demand and government stimulus measures. India remained a standout performer,with both manufacturing and services sectors experiencing robust growth. Japan’s economy showed signs of stabilization, but growth remained modest. The region’s overall economic performance was supported by strong export growth and increasing foreign investment.

Sector-Specific Analysis: Manufacturing vs. Services

Manufacturing sector – Stabilization Amidst Challenges

The global manufacturing sector showed signs of stabilization in July 2025,but growth remained weak. New orders increased slightly,but backlogs of work remained low. Output growth was constrained by supply chain disruptions and rising input costs. Manufacturers reported increased pressure on profit margins. The sector’s performance was particularly weak in Europe, while Asia-Pacific showed more resilience. Industrial production data will be key to monitoring the sector’s trajectory.

Services Sector – Moderating Growth & demand Cooling

The services sector remained the primary driver of global economic growth in July 2025, but the rate of expansion moderated. New business growth slowed, reflecting a cooling of demand in consumer-facing industries. Employment growth remained positive, but at a slower pace. Service providers reported rising operating expenses, driven by labor costs and energy prices. The sector