A batch of positive economic news has revealed progress for major players in the global economy but a new wave of lockdowns and restrictive measures threaten to derail any momentum.
South Korea has one of the most dynamic economies in the world and has been highly praised for its pandemic response. It has seen its factory activity expand at its fastest pace for over two years in October. The new data comes from the IHS Markit purchasing managers’ index which saw a recording of 51.2, up from 49.8 the previous month.
Responding to the data Usamah Bhatti, an economist at IHS Markit said, “October data marks a clear improvement in South Korea’s manufacturing sector … outright expansions in both output and new orders were registered, with both rising at their fastest paces in seven-and-a-half years.”
Elsewhere in Europe the euro zone saw growth at a rate that surpassed expectations for the third quarter. The euro zone countries enjoyed strong growth of 12.7% following a decline of 11.8% in Q2. Of some of the major countries France, Italy and Spain saw growth rates between 16.1% and 18.2% whilst Germany achieved 8.2%.
However such positive news will surely be tempered by the wave of new COVID-19 cases across Europe that has prompted fresh lockdown measures in many countries. The lesson is clear from this period that the example shown by South Korea where effective pandemic response has been combined with an open approach to trade is the only way temper the damage of COVID-19 and foster recovery prospects.