China PMIs sink

Trade war landing in China. First the manufacturing PMI:

In May 2019 , the China Manufacturing Purchasing Managers Index ( PMI ) was 49.4% , down 0.7 percentage points from the previous month .

In terms of enterprise scale, the PMI of large enterprises was 50.3% , which was 0.5 percentage points lower than that of the previous month and still higher than the critical point; the PMI of small and medium-sized enterprises was 48.8% and 47.8% , which were 0.3 and 2.0 percentage points lower than the previous month .

From the classification index, among the five sub-indices that constitute the manufacturing PMI , the production index and supplier delivery time index are above the critical point, and the new order index, raw material inventory index and employee index are below the critical point.

The production index was 51.7% , down 0.4 percentage points from the previous month and still above the critical point, indicating that manufacturing production continued to expand.

The new order index was 49.8% , down 1.6 percentage points from the previous month , below the critical point, indicating that the manufacturing market demand has declined.

The raw material inventory index was 47.4% , up 0.2 percentage points from the previous month , below the critical point, indicating that the decline in the main raw material inventory of the manufacturing industry has narrowed.

The employee index was 47.0% , down 0.2 percentage points from the previous month . It was below the critical point, indicating that the manufacturing industry’s employment fell.

The supplier’s delivery time index was 50.9% , up 1.0 percentage point from the previous month and above the critical point, indicating that the lead time of manufacturing raw material suppliers has accelerated.

And the services PMI:

In May 2019 , China’s non-manufacturing business activity index was 54.3% , which was the same as last month, indicating that the non-manufacturing industry continued to develop steadily and rapidly.

In terms of industries, the service industry business activity index was 53.5% , up 0.2 percentage points from the previous month , and the service industry continued to maintain rapid growth. From the perspective of industry categories, the business activity index of the railway transportation industry, air transportation industry, postal industry, accommodation industry, telecommunications radio and television and satellite transmission services, and Internet software information technology services is located at a high level of 60.0% . The activities were more active, and the total business volume increased rapidly; the index of business activities in the wholesale industry, capital market services, insurance industry and other industries was below the critical point, and the industry sentiment declined. The construction industry business activity index was 58.6% , down 1.5 percentage points from the previous month . It is still in the higher economic range, and the construction industry continues to maintain rapid expansion.

The new order index was 50.3% , down 0.5 percentage points from the previous month and above the critical point, indicating that demand growth in the non-manufacturing market has slowed. In terms of industries, the service industry’s new order index was 50.0% , down 0.2 percentage points from the previous month , at the critical point; the construction industry’s new order index was 52.1% , down 2.5 percentage points from the previous month .

The price index of input products was 52.2% , which was 0.8 percentage points lower than that of the previous month . It was above the critical point, indicating that the overall level of input prices of non-manufacturing enterprises used for business activities continued to rise, but the growth rate narrowed. In terms of industries, the service industry input price index was 51.7% , down 0.8 percentage points from the previous month ; the construction industry input price index was 55.1% , down 1.0 percentage point from the previous month .

Holding up but the construction PMI at 55.1 is not very strong.

Not a great set of reports for growth or stimulus impacts so far.

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