That is, it is supply not demand driven. Goldman has more:
1. The China NBS purchasing managers’ indexes (PMIs) survey suggestedvmanufacturing activity continues to improve but at a slower pace in March afterv China’s reopening. The NBS manufacturing PMI headline index fell to 51.9 in March from 52.6 in February, partly driven by residual seasonality. Among five major sub-indexes, the output sub-index fell to 54.6 from 56.7, the new orders sub-index decreased to 53.6 from 54.1 and the employment sub-index ticked down to 49.7 from 50.2. The suppliers’ delivery times sub-index fell to 50.8 in March from 52.0 in February but remained above 50. NBS commented that the drop in March PMI reading was partly due to the high base in February and the above-50 reading suggested ongoing improvement in both firm production and consumer demand.
2. On the trade-related sub-indexes, the new export order sub-index decreased to 50.4 in March (vs. 52.4 in February) but remained above 50, pointing to improved external demand. The import sub-index fell to 50.9 in March (vs.51.3 in February). The raw material inventories sub-index fell to 48.3 from 49.8, and the finished goods inventories sub-index fell to 49.5 from 50.6. By enterprise size, the PMIs of large/medium/small enterprises decreased to 53.6/50.3/50.4 in March (vs. 53.7/52.0/51.2 in February). Price indicators in the NBS manufacturing survey suggest inflationary pressure for producer and consumer eased notably in March. The input cost sub-index fell sharply to 50.9 (vs. 54.4 in February) and the output prices sub-index declined to 48.6 (vs. 51.2 in February).
