China's flash manufacturing PMI (purchasing managers' index) in October shows virtual stagnation while Japan's manufacturing index shows moderate growth according to data published Thursday.
The 50 level marks no change or stagnation and the flash China Manufacturing PMI is at 50.4 in October (50.2 in September) - a three-month high - while the flash China Manufacturing Output Index is at 50.7 in October (51.3 in September) - a five-month low.
Commenting on the Flash China Manufacturing PMI survey, Hongbin Qu, chief economist, China & Co- Head of Asian Economic Research at HSBC said: "The HSBC China Manufacturing PMI improved to 50.4 in the flash reading for October, up from 50.2 in the final reading for September. Domestic as well as external demand showed some signs of slowing although both remained in expansion territory. Disinflationary pressures intensified, as both the input and output price indices declined further. Meanwhile both employment and inventory indices improved. While the manufacturing sector likely stabilized in October, the economy continues to show signs of insufficient effective demand. This warrants further policy easing and we expect more easing measures on both the monetary as well as fiscal fronts in the months ahead."
Flash Japan Manufacturing PMI at 52.8 (51.7 in September) reflects a modest improvement in business conditions in September while the flash Japan Manufacturing Output Index is at 52.3 (53.4 in September) showing moderate growth for third successive month
Amy Brownbill, economist at Markit, which compiles the survey said: “Latest data indicated robust growth of operating conditions for Japanese manufacturers. New business rose at the highest rate since February and output remained in modest growth territory for the third month in a row. Furthermore, payroll numbers rose fractionally during the month, following a decline in September.
“Given the upcoming decision regarding the second planned increase of sales tax to 10%, questions will turn to the sustainability of the upturn in growth over the coming months.”
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