Flash PMI shows further economic expansion
September 30, 2013 Category Macro-economy, Weekly
China’s manufacturing activity in September expanded the most in six months, indicating continuing improvement in the country’s economy. The HSBC Flash China Manufacturing Purchasing Managers Index (PMI) settled at 51.2 this month, up from August’s final reading of 50.1 and July’s 47.7, which was the lowest in 11 months. A reading above 50 means expansion. The final HSBC PMI – released on September 30 – stood at 50.2, below last week’s flash reading of 51.2, with domestic orders proving to be weaker than preliminary estimates suggested. The Flash PMI showed growth in output, new orders, export orders and prices was faster in September, while employment fell at a slower rate. Qu Hongbin, Chief Economist for China and co-head of Asian Economic Research at HSBC, said the data confirmed a rebound in China’s growth supported by improvements in external and domestic demand. Zhu Haibin, JPMorgan China’s Chief Economist, said the PMI was higher than expected, but China may still risk slower growth next year under economic reforms and relatively tight monetary policies. “The economy is still facing structural problems of overcapacity in some key industries and mounting financial risks,” Zhu said. Exports staged a promising comeback this month, the Flash PMI showed, with new export orders jumping 3.6 points to a 10-month peak of 50.8. It was the first time in six months that export orders were above 50 points, the level that indicates expansion. Domestic demand also showed resilience. The National Bureau of Statistics (NBS) releases the official manufacturing PMI, sampling mainly state-owned companies, on October 1. The official gauge rose to 51 in August, the highest since April 2012.
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