HSBC/Markit Flash China manufacturing PMI signals further contraction in June21 June, 2012, 11:25. Posted by Zarathustra
HSBC/Markit flash estimate of China manufacturing PMI for June continues to show weakness. Headline PMI fell from 48.4 in May to 48.1 in June’s initial estimate, a 7-month low.
New orders and new export orders are contracting at faster rates, while inventory of finished goods are expanding at a faster rate. This is not good.
The chart below shows the HSBC/Markit China PMI vs. the official PMI. Earlier this year, there has been a significant divergence between the two, and it appeared that HSBC/Markit PMI was closer to the reality than the official one. It will be interesting to see if the official PMI would come down further in June.
Source: NBS, HSBC/Markit
Meanwhile, this is how the internals of the PMI looks like. As said, this does not appear to be a good mix of internals you want.