Manufacturing growth in China slowed marginally in February as operating conditions improved but at a weaker pace, according to HSBC's latest Flash Purchasing Managers' Index™. The headline figure of 50.4 in February represents a four-month low and is down on January's reading of 52.3.
Output, purchases and new orders all increased but at a slower rate while new export orders decreased, in a change of direction. Output and input prices both rose but at a slower rate. Employment levels grew but the rate of growth was down on the previous month.
Despite the moderation of February's Flash PMI™, the index recorded the fourth consecutive reading above the 50 critical line
Greater China, HSBC
The Flash China Manufacturing Output Index for February fell to 50.9, a four-month low. This compares to 53.1 in January.
Qu Hongbin, Co-Head of Asian Economic Research and Chief Economist, Greater China, said: "The Chinese economy is still on track for a gradual recovery. Despite the moderation of February's Flash PMI™, the index recorded the fourth consecutive reading above the 50 critical line. The underlying strength of Chinese growth recovery remains intact, as indicated by the still-expanding employment and the recent pick-up of credit growth."
Any figure above 50 shows manufacturing growth, while below 50 signals contraction. The report is based on data compiled from monthly replies to questionnaires sent to purchasing executives in more than 420 manufacturing companies.
HSBC's final China Manufacturing PMI™ for February is due on Friday, 1 March.
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