Global Economy Shows Signs of Escaping the 'Corona Quagmire'
PMI Strengthens in the US, Europe, and Japan
Stock Markets in Each Country Rise Together
US Considers Additional Economic Stimulus
[Asia Economy New York=Correspondent Baek Jong-min] The global economy, which had been contracted due to the novel coronavirus infection (COVID-19), is showing signs of escaping the slump thanks to the resumption of economic activities.
On the 23rd (local time), the Purchasing Managers' Index (PMI) for the Eurozone (19 countries using the euro) released by IHS Markit was 47.5, significantly surpassing the market expectation of 40.9 compiled by Dow Jones. A PMI above 50 indicates economic expansion, while below 50 indicates contraction. France, which suffered greatly from COVID-19, recorded a composite PMI of 51.3, indicating it has already entered an expansion phase.
The US PMI also improved significantly compared to the previous month. This month's US composite PMI rose to 46.8, and Japan's composite PMI was recorded at 37.9, showing a substantial increase from last month.
US and European stock markets also rose simultaneously. The US Dow Jones Industrial Average increased by 0.5% to 26,156.10, and the S&P 500 index rose 0.43% to 3,131.29. The Nasdaq index reached 10,131.37, setting another all-time high. In Europe, the UK FTSE 100 index rose by 1.21%.
As signs of economic recovery appear, additional stimulus measures are also accelerating. US Treasury Secretary Steven Mnuchin said on the day, "We are discussing with Congress to pass additional stimulus measures in July," emphasizing that "escaping the recession within this year is possible."
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However, concerns about the resurgence of COVID-19 remain. Anthony Fauci, director of the National Institute of Allergy and Infectious Diseases (NIAID) under the US National Institutes of Health, appeared before Congress and stated, "The next approximately two weeks are critical for the US response to COVID-19," and announced plans to expand testing.
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