Conditions in China’s manufacturing sector deteriorated in February, according to the HSBC Flash China Manufacturing Purchasing Managers’ Index™. The index fell to a seven-month low of 48.3, from 49.5 in January.
The building-up of disinflationary pressures implies that the underlying momentum for manufacturing growth could be weakening
Chief Economist for Greater China, HSBC
Qu Hongbin, Chief Economist for Greater China and Co-Head of Asian Economic Research, HSBC, said: “February’s Flash reading of the HSBC China Manufacturing PMI™ moderated further as new orders and production contracted, reflecting the renewed destocking activities. The building-up of disinflationary pressures implies that the underlying momentum for manufacturing growth could be weakening. We believe Beijing policy makers should and can fine-tune policy to keep growth at a steady pace in the coming year.”
Output fell and new orders and new export orders also decreased. Employment fell at a faster rate. Backlogs of work dropped.
The Flash PMI™ is the earliest available indicator of operating conditions in China. It is published more than a week before the final PMI™ data is released and is based on around 85 per cent to 90 per cent of total PMI™ survey responses.
The HSBC Flash China Manufacturing Output Index also fell to a seven-month low. The index was 49.2 in February, from 50.8 in January.
The final February PMI™ is due for release on 3 March.
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