Mostly as expected and certainly felt with the market craziness over the past month, global manufacturing continued to slow in August as confirmed by data today. Manufacturing indices were below 50 in South Korea, Taiwan, China (HSBC figure below 50, other PMI a touch above), France, Italy, UK and Sweden. Specifically in China’s state enterprise weighted PMI, export orders fell below 50 for the 1st time since April ’09. The US Aug ISM figure is expected to be 48.5 vs 50.9 in July. Responding to growing growth concerns, Brazil’s central bank lowered interest rates by 50 bps to 12%. Spain sold 5 yr notes but not as much as expected and yields there are rising to 3 1/2 week highs. Italian yields are also moving higher. Positively, Ireland’s 10 yr note yield is falling to the lowest since Jan.
