Alt+0 to show this section, Tab to navigate forward, Shift+Tab key to navigate backward, Enter to access link, and Esc to reset

Press tab key to access skip links section. Press Alt+0 to access it anytime.
Menu

30 Jan 2014

New year fall for PMI

New year fall for PMI

Employment levels fell for the third month, according to the HSBC China Manufacturing PMI

China’s manufacturing sector has contracted for the first time in six months, according to the HSBC China Manufacturing Purchasing Managers’ Index (PMI). The index dropped to 49.5 in January, down from 50.5 in December. It was also slightly lower than the early indicator Flash reading of 49.6, released on 23 January.

Policymakers should pay attention to downside risks and pre-emptively fine-tune policy to steady the pace of growth if needed

Qu Hongbin,
Chief Economist for Greater China, HSBC

Qu Hongbin, Chief Economist for Greater China and Co-Head of Asian Economic Research, HSBC, said: “A soft start to China’s manufacturing sectors in 2014, partly due to weaker new export orders and slower domestic business activities during January. Policymakers should pay attention to downside risks and pre-emptively fine-tune policy to steady the pace of growth if needed.”

Growth rates in output and new business weakened. New export orders declined for the second consecutive month, with firms suggesting weaker demand in a number of key export markets.

Employment levels fell for the third consecutive month and businesses cut jobs at the fastest pace since March 2009. Production levels continued to increase, while costs declined for the first time since July. Reduced costs were passed on to clients through lower output charges.

Purchasing activity increased for the sixth successive month, however the pace of growth was the weakest since September 2013.

PMIs™ are based on data compiled from monthly replies to questionnaires sent to purchasing executives in manufacturing companies. A reading above 50 indicates expansion, while one below 50 signals contraction.

The Flash China Manufacturing PMI is due for release on 20 February.

The intellectual property rights to the HSBC 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.

Related content

PMI suffers December drop

PMI suffers December drop

02 Jan 2014

Chinese manufacturing conditions hit a three-month low in December,…

Flash PMI at six-month low

Flash PMI at six-month low

23 Jan 2014

China’s manufacturing sector hit a six-month low in January, according to…