China official manufacturing PMI points to continued contraction in September1 October, 2012, 9:24. Posted by Zarathustra
China’s official manufacturing PMI remains below 50, below consensus estimate.
Headline PMI for September rose from 49.2 to 49.8, below estimate of 50.1, and remains below 50, indicating continued contraction in manufacturing activities. Because of the seasonality of the official PMI, it should be noted that in the previous years, September’s PMI headline figure rose by 2 points on average, so the actual headline figure is weak.
Looking into individual sub-indices, output rose from 50.9 to 51.3. New orders rose from 48.7 to 49.8 and new export orders rose from 46.6 to 48.8. Finished goods inventory fell from 48.2 to 47.9, which brings the new orders minus inventory measures from 0.5 to 1.9. Meanwhile, input price rose from 46.1 to 51, surprisingly above 51, indicating the possible return of price pressure.
Meanwhile, employment fell slightly from 49.1 to 48.9.
Source: NBS, CFLP
Although the headline shows a slight improvement, it remains below 50, which is well within the contractionary territory. Perhaps worse still, given the fact that Septembers tend to be a strong month, the actual headline figure for this September is actually quite weak, and much of the improvements in the sub-indices appear to be largely seasonal, rather than real improvements. All these make this official PMI report a rather weak one despite marginal improvement