China PMI

[BlueKelah]

China August flash factory PMI shrinks at fastest pace in 6-1/2 years

BEIJING (Reuters) - Activity in China's factory sector shrank at its fastest pace in almost 6-1/2 years in August as domestic and export demand dwindled, a private survey showed, adding to worries that the world's second-largest economy may be slowing sharply.

The preliminary Caixin/Markit China Manufacturing Purchasing Managers' Index (PMI) stood at 47.1 in August, well below a Reuters poll median of 47.7 and down from July's final 47.8.

The reading was the worst since March 2009, in the depths of the global financial crisis, and the sixth straight one below the 50-point level, which separates growth in activity from contraction on a monthly basis.

The flash PMI, the earliest economic measure to be released about China each month, is closely followed by global investors for clues on how the economy is faring.
A detailed breakdown of the activity survey showed conditions were deteriorating by almost every measure, with factory output sinking to a near four-year low, domestic and export orders declining at a faster rate than in July and companies laying off more workers.

The dismal August flash number bodes ill for upcoming official data, and could fuel fears that the China's economy is slumping faster than authorities anticipated, dashing hopes for a global recovery.

Chinese authorities have struggled to stabilise the country's stock markets after a near-collapse in early summer, and stunned financial markets this month by devaluing the yuan by nearly 2 percent, stoking fears about the health of the economy.

The central bank said the yuan move was a technical one and part of its currency reform process, but many investors fear the currency will be allowed to depreciate further amid political pressure to shore up flagging exports, potentially triggering a global currency war.

Devastating explosions at the key port of Tianjin may also have been a factor in weaker-than-expected activity this month.

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Looks like more downside for emerging markets. Hunting season continue!!!

[greengiraffe]

China’s factory activity decreases at slower pace

• GRACE ZHU
  
• DOW JONES
  
• NOVEMBER 02, 2015 2:26PM
  

[Image: 006951-2efaf498-8113-11e5-970a-9231c6de7a20.jpg]
A worker in a Chinese textile factory. Source: News Corp Australia
[b]China’s factory activity decreased at a slower pace in October, according to a private-sector gauge, indicating Beijing’s earlier stimulus measures might be having an impact.[/b]
The new reading released today to paint a mixed picture for China’s manufacturing sector. An official government-run gauge of manufacturing activity released over the weekend came in weaker than expected. Still, today’s reading suggests some factories — particularly smaller and medium-size ones — may be seeing some relief.
The Caixin China manufacturing purchasing managers index, a gauge of nationwide manufacturing activity, rose to 48.3 in October from 47.2 in September, according to data released Monday by Caixin Media Co. and research firm Markit.
The reading suggests the shrinkage in factory activity may be slowing, although it marked the eighth straight month of contraction. A reading below 50 indicates a contraction in manufacturing activity from a month earlier, while a reading above that level indicates expansion.
“The slight upswing shows the manufacturing industry’s overall weakening has slowed down, indicating that previous stimulating measures have begun to take effect,” said He Fan, chief economist at Caixin Insight Group.
“Weak aggregate demand remained the biggest obstacle to economic growth, and the risk of deflation resulting from the continued fall in the prices of bulk commodities needs attention,” he added.
Sluggish demand at home and abroad has saddled Chinese factories with overcapacity and forced them to cut prices. The producer-price index has lingered in deflationary territory for 43 consecutive months.
“Though the Caixin PMI came in better-than-expected, it doesn’t mean China’s small manufacturers are now out of woods,” said Zhang Fan, an economist with RHB Group.
China’s official manufacturing PMI, released yesterday, came in at a lower-than-expected at 49.8 — which was also in contraction territory and unchanged from a month earlier.
Compared with the government survey, Caixin PMI gives a greater weighting to smaller, export-led companies. The official measure has a greater proportion of large state-owned firms.
China’s economy grew 6.9 per cent from a year earlier in the third quarter, which was its slowest pace since the global financial crisis, though some economists believe current growth may be much weaker than government figures showed.
In a bid to shore up growth and meet Beijing’s 2015 growth target of about 7 per cent, Beijing has cut interest rates six times since November and lowered the amount of cash that banks must hold as reserves several times to encourage lending. It has also sped up spending on infrastructure and relaxed curbs on home purchases and mortgage lending to rejuvenate the slumping property market.
Dow Jones

[greengiraffe]

China's service sector picks up

Oct activity grows at fastest pace in 3 months as PMI rises to 52, mainly from new business
BEIJING • Activity in China's service sector expanded at its fastest pace in three months last month.
This is thanks to stronger new business, a private survey showed yesterday, easing concerns over persistent weakness in the economy as the manufacturing sector falters.
The Caixin/Markit Purchasing Managers' Index (PMI) rose to 52.0 last month from September's 14-month low of 50.5, hitting the highest level since July.

A reading above 50 points signifies growth on a monthly basis, while one that falls below that indicates a contraction.
"This shows that previous stimulus policies have begun to take effect, while the economic structure steadily improved," said chief economist at Caixin Insight Group He Fan. "The economy has started to show signs of stabilising, reducing the need for a further stimulus."
A sub-index measuring new business jumped to 52.9 from September's 50.5, while the employment sub-index also improved to a three-month high.

STEADY IMPROVEMENT
The economy has started to show signs of stabilising, reducing the need for a further stimulus.
MR HE FAN, chief economist at Caixin Insight Group, on the rise in the PMI

Still, underscoring an uncertain economic outlook, business expectations moderated to a record low last month.
China's official service survey showed on Sunday that growth in China's service industry cooled last month, expanding at its slowest pace in nearly seven years.
The private survey focuses on small and mid-sized companies, while the official gauge looks more at larger state firms.
Two manufacturing PMIs released earlier showed business conditions in China continuing to cool gradually, moderating fears shared by some global investors of a hard landing for the world's second-largest economy.
Beijing has rolled out a flurry of support steps since last year to avert a sharper slowdown, including slashing interest rates six times since November last year and lowering the amount of cash that banks must hold as reserves four times this year.
But such measures have been slower to take effect than in the past, and some economists still expect Beijing to roll out more support in coming months.
China's economy grew 6.9 per cent between July and September from a year earlier, dipping below 7 per cent for the first time since the global financial crisis, though some market watchers believe real growth rates are much weaker than government figures suggest.
REUTERS

[BlueKelah]

China's Manufacturing PMI Weakens to Lowest in Three Years

China’s manufacturing conditions slipped to the weakest level in more than three years as sluggishness in the nation’s old growth drivers add to risks facing the government’s growth target.

The official purchasing managers index fell to 49.6 in November, the National Bureau of Statistics said Tuesday -- the lowest level since August 2012. That compared with a median estimate of 49.8 in a Bloomberg survey of economists, which was also the level for September and October. The non-manufacturing PMI rose to 53.6 from 53.1 a month earlier. Numbers below 50 indicate deterioration.

[greengiraffe]

Small lift for China’s PMI from robust infrastructure spending

• MARK MAGNIER
  
  
• THE AUSTRALIAN
  
  
• JANUARY 2, 2016 12:00AM
  

[img=650x0]http://cdn.newsapi.com.au/image/v1/4fc3de780bae6ababad1e2413b18f487?width=650[/img]

Steel pipes at a port in Lianyungang. An official gauge of China’s manufacturing sector edged up in December.

[*]

An official gauge of China’s manufacturing sector edged up in December, helped by robust infrastructure spending, signalling a slight gain in momentum for the world’s second-largest economy.

The modest uptick in the official purchasing managers’ index reported yesterday was below expectations, however, suggesting that there won’t be a significant rebound in China’s economy anytime soon.
“The economy will continue to muddle through,” said ANZ Bank economist Li-Gang Liu. “In the coming year, we’re not going to see any turnaround in the economy. China’s economy is weighed down by large debt and will continue to slow.”
The National Bureau of Statistics said the PMI rose slightly to 49.7 in December from 49.6 a month earlier. This was below the median 49.8 level forecast by a Wall Street Journal poll of 10 economists and marked a fifth straight month of contraction. A PMI reading above 50 signals an expansion in activity, while a reading below points to a contraction.
The data follows weak readings for other parts of the economy. In November, foreign exchange reserves declined more than expected, exports fell and industrial profits contracted.
But there are some signs of improvement as well. The official non-manufacturing purchasing managers’ index, a gauge of activity beyond the factory floor, rose to 54.4 in December from 53.6 in November, the statistics agency said. Retail spending in November held up well, while industrial production data that month also was better than expected, even as it remained weak.
The Wall Street Journal