The HSBC China flash PMI was out this afternoon. According to the SMH:
HSBC’s China Flash PMI for July dropped by its fastest pace since March 2009 and pointed to a monthly contraction in the country’s vast manufacturing sector for the first time in 12 months, the purchasing managers’ survey shows, while a price sub-index signalled rebounding inflation.
The flash purchasing managers’ index (PMI), the earliest available indicator of China’s industrial activity, dipped to a 28-month low of 48.9 in July and fell below the 50-point level for the first time since July 2010, as policy tightening and slack global demand weighed on economic growth.
That compares with the final reading of 50.1 in the HSBC PMI for June. The 50-point level in the PMI demarcates expansion from contraction, with a reading above 50 indicating growth.
According to the final PMI reading in June, the industrial output sub-index fell to 49.8, indicating a contraction for the first time since July 2010. That trend has now been confirmed with the overall July Flash PMI reading.
Hmmm, production down and prices up. Also, from Bloomberg via Zero Hedge, below find an inventory of Chinese food inflation: