For the Quarter Ending September 2023
In September, Propylene glycol prices in North America experienced a 2.87% decline compared to July levels. The third quarter witnessed a deceleration in the growth of US company operations, attributed to reduced demand from both domestic and global markets. In the United States, inflation rose to 3.7% in August, marking the first increase since June 2022. This uptick was driven by a substantial rise in energy prices towards the end of summer, adversely impacting consumer confidence. The mounting inflationary pressures indicate a deviation from the Federal Reserve’s 2% target rate, prompting officials to consider raising interest rates later in the year. The Federal Reserve had previously raised its key policy interest rate by 0.25 percent in July, the eleventh such increase in 17 months, aiming to address persistent inflation and its impact on market demand. September witnessed increased economic uncertainty and weakened consumer confidence, influenced by rising fuel prices and higher interest rates. Manufacturers reported a further decline in new orders, forcing firms to liquidate inventory to sustain profitability.
In the Asia Pacific region, Propylene glycol prices exhibited a varied pattern in the Chinese market during the third quarter. July witnessed a 5.19% decrease in Propylene glycol prices due to reduced plant activity linked to a decline in downstream industry demand. Additionally, the strengthening of the Chinese yuan against the US dollar increased the international cost of Propylene glycol, resulting in decreased foreign market demand. Market suppliers prioritized destocking to minimize inventory and preserve profit margins. The official manufacturing purchasing managers’ index (PMI) in China marginally increased to 49.7 in August, contributing to a 0.39% rise in Propylene glycol pricing. Despite domestic economic concerns, such as the central bank’s key interest rate reduction, industry output and new orders continued to flourish in September. However, foreign demand remained weak, with the export orders index contracting for the third consecutive month, leading to a 4.36% decline in Propylene glycol prices.
Get Real Time Prices of Propylene Glycol: https://www.chemanalyst.com/Pricing-data/propylene-glycol-1095
In Germany, Propylene glycol prices experienced a continuous decline throughout the third quarter, recording a 3.49% drop in September. The purchasing managers’ index (PMI) in Germany was 41 in July, signaling an ongoing decline in new orders from both domestic and global markets, despite sufficient stocks among market players. August saw a sustained lack of consumer confidence due to increasing interest rates, surging inflation, the ongoing energy crisis, and global geopolitical complexities. The persistent inflation, primarily driven by elevated energy prices, weakened consumer purchasing power, contributing to the downward trajectory of Propylene glycol prices. Germany’s industrial sector, constituting around one-fifth of the nation’s economy, remained in a downturn in September, influenced by sluggish demand and rapidly declining output, further impacting Propylene glycol prices. In response to persistent inflation, the European Central Bank decided to raise interest rates for the eleventh consecutive time in September, maintaining low market demand and reinforcing the downward trend.
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