Source: The Business Times
Date: 3rd November 2025

Major economies struggle to revive factory activity in October as weak U.S. orders and ongoing trade frictions strain production and sentiment.

Manufacturing across the world’s largest economies continued to stagnate in October, as tariffs imposed by the U.S. and subdued demand weighed heavily on factory orders. Business surveys revealed persistent weakness in industrial output, with Europe’s manufacturing hubs, including Germany, France, and Italy, showing minimal or negative growth. Germany’s engineering sector reported a sharp drop in new orders, while only Spain managed to post a modest acceleration in factory expansion within the eurozone.

Across Asia, manufacturing activity painted a similarly mixed picture. China’s official data confirmed a seventh straight month of contraction, ending the brief export surge seen earlier in the year as exporters rushed to beat impending U.S. tariffs. South Korea’s factory output also slipped, with export orders declining amid trade uncertainty, while India bucked the regional trend as domestic demand drove factory growth. Southeast Asian economies such as Vietnam and Indonesia recorded gains, though Malaysia and Taiwan continued to face manufacturing declines.

The United States’ trade policies remain a central factor shaping global industrial conditions. The recently extended one-year suspension of reciprocal tariffs between Washington and Beijing has provided some relief but has not resolved deeper trade imbalances or restored confidence among exporters. Many manufacturers remain cautious, awaiting concrete signs that tariff tensions will ease before committing to increased production or investment.

For global shippers and exporters, the continued slowdown signals a challenging environment. Weak cross-border demand, longer lead times, and fluctuating production schedules are disrupting established supply chains. While selective trade deals offer short-term stability, the combination of tariffs, geopolitical uncertainty, and uneven recovery across regions suggests that manufacturers may face prolonged pressure heading into 2026.