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21 Mar 2013

China recovery continues

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China’s manufacturing activity increased in March, suggesting that its gradual recovery remains on track. The HSBC Flash China Manufacturing Purchasing Managers’ Index™ (PMI™) for March was 51.7, up from 50.4 in February.

The improvement was driven by a faster rate of increase in new orders, including export orders, and in output. The Flash China Manufacturing Output index rose to 52.8, from 50.8 in February.

Inflation remains well behaved, leaving
room for Beijing to
keep policy relatively accommodative in
a bid to sustain
growth recovery

Qu Hongbin,
Chief Economist,
Greater China, HSBC

Manufacturers reported a bigger backlog of work and a faster rate of increase in purchases. Stocks of finished goods expanded. Employment increased at a slower rate than in February. Encouragingly, inflationary pressures eased.

PMIs™ are a monthly indicator of economic trends. The China survey is based on responses from purchasing executives in more than 420 manufacturing companies. Any figure above 50.0 signals expansion, while below 50.0 indicates contraction.

The Flash index is published about one week before the final PMI™ data.

Qu Hongbin, Chief Economist, Greater China, and Co-Head of Asian Economic Research at HSBC, said: “March Flash Manufacturing PMI™ rebounded to 51.7 on the back of stronger new orders and production growth. This implies that the Chinese economy is still on track for gradual growth recovery. Inflation remains well behaved, leaving room for Beijing to keep policy relatively accommodative in a bid to sustain growth recovery.”

The China Manufacturing PMI™ is due for release on 1 April.

The intellectual property rights to the HSBC Flash China Manufacturing PMI™ provided herein is owned by Markit Economics Limited. Any unauthorised use, including but not limited to copying, distributing, transmitting or otherwise of any data appearing is not permitted without Markit’s prior consent. Markit shall not have any liability, duty or obligation for or relating to the content or information (“data”) contained herein, any errors, inaccuracies, omissions or delays in the data, or for any actions taken in reliance thereon. In no event shall Markit be liable for any special, incidental, or consequential damages, arising out of the use of the data. Purchasing Managers' Index™ and PMI™ are trade marks of Markit Economics Limited, HSBC use the above marks under license. Markit and the Markit logo are registered trade marks of Markit Group Limited.

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