Chinese manufacturing PMI rose slightly in September signalling that export demand is helping the economy counter the ongoing property slump.
The Flash China Manufacturing PMI (purchasing managers' index) at 50.5 in September (50.2 in August) compares with the no-change 50 level and the Flash China Manufacturing Output Index at 51.8 in September (51.8 in August) was unchanged from August’s two-month low.
The HSBC Flash China Manufacturing PMI is published on a monthly basis ahead of final PMI data, making the HSBC PMI the earliest available indicator of manufacturing sector operating conditions in China. The estimate is typically based on approximately 85%–90% of total PMI survey responses each month and is designed to provide an accurate indication of the final PMI data. September final PMI data will be released on 30 September 2014.
Hongbin Qu, chief economist, China & Co- head of Asian Economic Research at HSBC said: "The HSBC China Manufacturing PMI rose to 50.5 in the flash reading for September, up from the final reading of 50.2 in August. The picture is mixed, with new orders and new export orders registering some improvement. Meanwhile, the employment index declined further and disinflationary pressure intensified. Economic activity in the manufacturing sector showed signs of stabilization in September. However, overall the data still point to modest expansion.
The property downturn remains the biggest downside risk to growth. We continue to expect more monetary easing from the PBoC (People's Bank of China) in order to steady the recovery."
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