China Flash PMI falls, misses expectations

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By Leith van Onselen

More evidence of the Chinese economy slowing this afternoon, with the HSBC Flash China Manufacturing Purchasing Managers’ Index (PMI) for November registering a fall, decreasing to 50.0 from 50.4 in October – a six month low.

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The result missed analyst’s expectations, with economists polled by Bloomberg expecting the flash PMI to fall to 50.2.

The Flash China Manufacturing Output Index also fell sharply to 49.5 in November, down from 50.7 in October – a seven-month low.

Commenting on the result, Hongbin Qu, Chief Economist, China & Co-Head of Asian Economic Research at HSBC said:

“The HSBC China Manufacturing PMI moderated to a six-month low of 50.0 in the flash reading for November, down from the October final reading of 50.4. New export order growth continued to ease and led to a below-50 reading for the output sub-index for the first time since May. Disinflationary pressures remain strong and the labour market showed further signs of weakening. Weak price pressures and low capacity utilization point to insufficient demand in the economy. Furthermore, we still see uncertainties in the months ahead from the property market and on the export front. We think growth still faces significant downward pressures, and more monetary and fiscal easing measures should be deployed.”

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The Australian dollar fell on the worse than expected result.

Unconventional Economist

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