| Click for the Finfacts Ireland Portal Homepage |

Finfacts Business News Centre

Home 
 
 News
 Irish
 Irish Economy
 EU Economy
 US Economy
 UK Economy
 Global Economy
 International
 Property
 Innovation
 
 Analysis/Comment
 
 Asia Economy

RSS FEED


How to use our RSS feed

Follow Finfacts on Twitter

 
Web Finfacts

See Search Box lower down this column for searches of Finfacts news pages. Where there may be the odd special character missing from an older page, it's a problem that developed when Interactive Tools upgraded to a new content management system.

Welcome

Finfacts is Ireland's leading business information site and you are in its business news section.

Links

Finfacts Homepage

Irish Share Prices

Euribor Daily Rates

Irish Economy

Global Income Per Capita

Global Cost of Living

Irish Tax - Income/Corporate

Global News

Bloomberg News

CNN Money

Cnet Tech News

Newspapers

Irish Independent

Irish Times

Irish Examiner

New York Times

Financial Times

Technology News

 

Feedback

 

Content Management by interactivetools.com.

Asia Economy Last Updated: Jun 3, 2014 - 6:45 AM


China's manufacturing PM1 fell slightly in May; Official report shows services robust
By Finfacts Team
Jun 3, 2014 - 5:32 AM

Email this article
 Printer friendly page

China's manufacturing PM1 (purchasing managers' index) was published Tuesday and reflecting activity in the private sector, shows a dip in output for the fourth straight month. An official PMI report on manufacturing mainly reflecting activity of state-owned firms, shows a slight rise in output while a report on services issued today signalls a robust performance.

A Markit report that was prepared for HSBC Plc, the global bank, shows that latest data signalled operating conditions in China’s manufacturing sector deteriorated only marginally in May. Output contracted at a fractional pace, while new orders stabilised after a three-month sequence of decline. Subdued client demand was linked by panellists to relatively weak market conditions. In contrast, new export orders rose at the quickest pace in over four years, with a number of companies citing new client wins. Job shedding meanwhile persisted, with the latest reduction of workforce numbers the strongest in three months.

After adjusting for seasonal factors, the HSBC PMI - - a composite indicator designed to provide a single-figure snapshot of operating conditions in the manufacturing economy - - posted at 49.4 in May, down slightly from the earlier flash reading of 49.7, and up from 48.1 in April. The reading signalled only a marginal deterioration in business conditions. The health of the sector, however, has now deteriorated in each month of 2014 so far.

Manufacturers in China reported a fourth successive monthly fall in output during May. That said, the rate of contraction was only fractional. According to panellists, uncertain economic conditions led some firms to lower production over the month. Total new business was unchanged in May, following a three-month sequence of reduction. Data suggested that muted domestic demand hindered overall new work wins, as new export orders rose at the fastest rate since April 2010.

Improving demand conditions led to an increased amount of purchasing activity in May, albeit only marginal. Nonetheless, it was the first time that input buying had increased in four months. Stocks of purchases were relatively unchanged in May, ending a three-month sequence of depletion. Inventories of finished goods fell for the first time in 2014 so far, though only slightly, as some companies increased their use of current stocks to meet new incoming orders.

Employment at manufacturing companies declined again in May, as has been the case since November 2013. The rate of reduction was marked overall, and partly driven by company down-sizing policies. Despite lower staffing levels, backlogs of work also declined.

Average cost burdens fell again in May, though the rate of deflation was the weakest in the current five-month sequence. In contrast, output charges increased for the first time in 2014 so far, with some firms commenting that improved demand conditions boosted pricing power.

Hongbin Qu, chief economist, China & co-head of Asian Economic Research at HSBC said: "The final HSBC China Manufacturing PMI rebounded to 49.4 in May, up from 48.1 in April, and revised down slightly from the earlier flash reading of 49.7. New orders stabilized, while new export orders recorded an impressive expansion of 53.2. But growth momentum looked weaker than suggested in the flash reading as the stocks of finished goods index was revised up to 49.8 from 48.8 in the flash reading. The final PMI reading for May confirmed that the economy is stabilizing, but it is too early to say that it has bottomed out, particularly in light of a weaker property sector. The lack of a sustainable growth momentum warrants stronger policy support. We expect both monetary and fiscal policy to be loosened gradually over the coming months."

Reuters reports that China's services sector grew at its fastest pace in six months in May as new orders rebounded.

The official non-manufacturing PMI climbed to 55.5 from April's 54.8, the National Bureau of Statistics said. That is well above the 50-point level that separates an expansion from a contraction in activity.

New orders recovered to an eight-month high of 52.7, compared to April's 50.8. Business expectations also held their ground at a solid 60.7, compared to April's 61.5.

Official data on Sunday showed China's manufacturing industry grew at its fastest pace in five months in May due to rising new orders, as a PMI for the sector touched a high of 50.8 in May.

Related Articles
Related Articles


© Copyright 2011 by Finfacts.com

Top of Page

Asia Economy
Latest Headlines
IMF defers renminbi reserve decision; Devaluations losing firepower
Japan's trade deficit widens and GDP falls despite 33% yen devaluation
China's exports slide in July; Fx reserves dip $42.5bn in month
Chinese manufacturing PMI falls for 5th straight month in July; Japan at 5-month high
China's overseas investments to surge; Ireland got €99m of €46bn invested in EU in 2000-2014
China to overtake US economy in 2026; Income per capita will be 50% of US in 2050
Manufacturing activity in China and Japan contracted in June
China's manufacturing contracted for third straight month in May; Japan in slight rise
Asia accounts for 40% of global output, two-thirds of global growth
China's exports unexpectedly fell in April 2015 after March dip
China's growth in 2015 at slowest since early 2009
China's 2015 foreign trade continues to slide
Singapore remains world’s top location for business on 50th anniversary of independence
China's manufacturing activity fell to a 11-month low in March
China in surprise rate cut to boost sagging economy
Chinese Lunar New Year: Year of the Wood Goat begins this week
China’s manufacturing shrunk in January; Regional rise except Indonesia
Profits of Chinese industrial businesses plunged in 2014
China's growth in 2014 fell to a 24-year low
Services activity in China, Japan and India in moderate rises in December
China’s manufacturing industry remains competitive despite rising wages
China revises 2013 GDP up 3.4% to 56.5% of US economy size
China's manufacturing contracts in December; Japan's grows
China's imports slide in November; Emerging markets slow
Manufacturing PMI stalled in China in November; Fell in Korea, Indonesia , grew in India
China's manufacturing output contracted in November; Japan's accelerated
Ireland not among top 67 destinations for Chinese outbound FDI in 2014
Japan fell into recession in third quarter of 2014
Services slowed in China, contracted in Japan and stagnated in India in October
Manufacturing in South Korea/ Indonesia contracted in October; India in slight rise
Two Chinese manufacturing reports show trading near stagnation levels
Bank of Japan raises money printing target; Spending and wages plunge
China's manufacturing stagnates, Japan in moderate growth
China’s economy in third quarter grew at slowest pace in five years
Chinese exports jump in September; "Sadness will return soon"
World Bank cuts growth forecasts for developing East Asia including China
Japanese business confidence slightly improves; Manufacturing sector weak
Developing Asia remains fastest-growing region in world in 2014
Chinese manufacturing PMI rose slightly in September
Japan reports 26th straight monthly trade deficit; Public debt tops ¥1,000tn