Global economy: manufacturing up in advanced nations

Research evidence excerpt

Global economy: manufacturing up in advanced nations

14 May 2026

Mizuho Securities Equity Research Economics / Domestic and Overseas Economy

Economic Weekly

Japan's Economy: Weekly Newsletter (14 May 2026)

Stocks have been strong globally despite the ongoing tensions in the MiddleChief Economist:

East. We see two main factors behind this. First, as we pointed out in our reportShunsuke Kobayashi

of 1 May 2026 titled Japan’s Economy: Monthly Outlook May 2026–Return of+81 3 6202 8222

shunsuke.kobayashi@mizuho-sc.com the ouroboros, we think the financial markets have already priced in a post-

war environment. Second, the US Treasury yield curve has flattened. As noted

Economist: in our report of 8 January 2026 titled Outlook for 2026, we think a shift to a

Soichiro Hirose positive yield curve for US Treasuries, as well as a steepening of the yield+81 3 6202 8293 curve, has probably restored the investment appeal of medium/long-term USsoichiro.hirose@mizuho-sc.com

Treasuries, causing capital to flow back from the risk assets market (including

equities) to such Treasuries. However, as we analyzed in detail in our 19 March

report titled Iran crisis, US-JP monetary policy: a quantitative analysis, the Fed

is unlikely to cut rates for the time being, and this has caused the yield curve

for US Treasuries to flatten.

However, we should not overlook the fact that economic fundamentals are now

showing an upward trend, supported not only by the above-noted geopolitical

and financial factors, but also by cyclical factors. As noted in our 23 April

2026 report titled Global economy: multi-lens analysis of mfg reacceleration,

it appears highly likely that the capex cycle, which influences long-term

economic cycles, has entered an uptrend, particularly in Europe and China.