A bevy of data and interest rate decisions by central banks around the world has been released, most of which has been buoying hopes that the global economy is continuing to recover, even as easy money remains the rule of the day.

Manufacturers in China, Europe and the US reported a much stronger than expected July, as key indexes posted impressive gains.

China’s official Purchasing Managers’ Index (PMI) for the manufacturing sector rose to 50.3 last month, even as the consensus called for another decline. Almost all of the index’s components posted increases, with the new orders reading rising from 50.4 in June to 50.6 in July. Most significantly, the new export orders component rose from 47.7 to 49 and backlogs rose from 42.9 to 44.7. At the same time, inventories of finished goods fell from 48.2 to 47.3.

The data is showing that inventories which had been stacking up at Chinese manufacturers are finally starting to find their way to buyers as demand is showing improvement. To be clear, though, this doesn’t mean that the Chinese economy is firing on all cylinders.

The official PMI data primarily covers China’s larger state-owned enterprises. There is also the “unofficial” HSBC China PMI which mainly covers smaller, private manufacturers and that index fell to an 11-month low of 47.7 in July from 48.2 in June. Most of that decline was due to the fact that smaller Chinese manufacturers have been suffering through a credit crunch in recent months, thanks to more restrictive lending policies as the government took steps to prevent another asset bubble in the country.

But as I discussed last week in “China Loosens the Reins,” the government has taken steps to lower taxes on smaller businesses and ease their access to export markets. Not only will that reduce those businesses’ overall costs, it will also help to once again make their products competitive in the global market.

While it’s still too soon for the impact of those steps to begin showing up in the data, it’s a good bet that the August numbers will show continued improvement.

At the same time, the Markit Eurozone Manufacturing PMI also rose to 50.2 in July from 48.8 in June, the first sign of growth in European manufacturing since July 2011.

Despite slowing economic growth in Poland, that country’s PMI reading rose from 49.2 in June to 51.1 in July. Warsaw is implementing its own stimulus program equal to about 1 percent of its gross domestic product which, coupled with the uptick in its manufacturing sector, should help the country avoid slipping into recession like so many of its neighbors.

The Czech PMI also posted a stronger-than-expected gain, hitting 52 versus 51 in June. That’s its fourth straight monthly increase and a strong sign that positive momentum is building.

In the region’s more developed economies, factory output also rose in Germany, the United Kingdom, Italy and France. In the US, the manufacturing PMI shot up from 50.9 in June to 55.4 in July.

Unfortunately, though, so far growth hasn’t strengthened to the point that any central bank is willing to risk rocking the boat and raise interest rates.

The Bank of England has decided not to resume its bond-buying program, but both it and the European Central Bank (ECB) are keeping interest rates at 0.5 percent. ECB President Mario Draghi also said that the ECB’s rates will remain at present levels for an extended period of time and might even go lower if the need presents itself.

The US Federal Reserve has also backed off its statements from June that it might end its own quantitative easing program sooner rather than later, giving no hint in its statement Wednesday that any changes are planned.

The improving manufacturing data from almost every corner of the world is a solid signal that the global economy is improving. Throw in the prospect of cheap money for the foreseeable future and you have conditions that bode well for strong global equity performance for at least the rest of the summer, turning the corner on the recent weakness in the emerging markets.

Portfolio Roundup

Colombia-based Ecopetrol (NYSE: EC) released its second quarter earnings report yesterday, revealing some high points and low points in its business so far this year.

Second quarter profits were dinged by lower international crude prices and higher transportation costs, falling 6.8 percent to COP3.4 trillion (USD1.8 billion) year-over-year. That did, however, exceed analyst estimates by about COP100 million.

Weakening of the Brent and Maya crude benchmarks resulted in lower sale prices. Higher transportation tariffs as a result of Ecopetrol spinning its midstream assets into a new, wholly owned subsidiary also squeezed margins. Repair costs increased, following an uptick in attacks by the Revolutionary Armed Forces of Colombia (FARC). So far this year, 113 pipeline attacks have been reported versus 68 in the same period last year.

That said, sales rose 6.6 percent to COP17.6 trillion in the quarter and production was up 2.1 percent to 778,100 barrels of oil equivalent per day (boepd). Crude sales into the local market rose by 25.9 million boepd, as Colombian demand for marine fuels rose and natural gas rose by 500,000 million boepd, thanks to growing industrial demand. In-country demand for medium distillates was also up by 4 million boepd because of a strong need for diesel and jet fuel.

Ecopetrol’s crude exports also grew by 24.9 million boepd. Despite weak Asian demand, exports to the US Gulf and West coasts grew by 9 percent and 2.3 percent respectively, while exports to other South American countries grew by almost 3 percent.

While this marks the company’s second quarter of declining profits, we look for the situation to improve in the back half of the year. As I discussed in last week’s issue of Passport to Profits, China has embarked on a stimulus program to ease the strain on its export sector, which is already showing progress with manufacturing ticking up.

In addition, through its new midstream subsidiary Cenit, Ecopetrol should realize higher profits on its pipeline and storage operations, which should more than offset new higher tariffs in the coming quarters.

Ecopetrol remains a buy up to 60.