China’s Manufacturing Activity Slows in April

SHANGHAI, CHINA – The latest flash HSBC / Markit PMI survey showed that China’s factory activity slowed to its lowest level in a year in April, with the purchasing managers’ index contracting to 49.2 percent.

The latest flash HSBC/Markit PMI suggests that China’s economic conditions remain in a deteriorating phase even as the country’s central bank has aggressively increased its policy easing.

HSBC’s preliminary reading of China’s factory activity for April came in at 49.2, compared with a Reuters forecast for a 49.6 print.

Last month, government data showed the official (PMI) edged up to 50.1, better than HSBC’s final PMI, which came in at 49.6 indicating the country’s vast manufacturing sector in contraction.

Analysts said the latest PMI data adds to signs that the country’s economy is decelerating faster than expected.

The HSBC Flash China Manufacturing PMI is published on a monthly basis ahead of final PMI data, which will be released on May 4, according to the statement.

The estimate is typically based on approximately 85-90 percent of total PMI survey responses each month.

The flash reading of the PMI signaled that “operating conditions in China’s manufacturing sector deteriorated slightly for the second month running in April.

Production increased only marginally, while total new business declined for the second successive month,” said Annabel Fiddes, an economist at Markit.

On a brighter note, demand from overseas improved in April, with new export work rising for the first time in three months, Fiddes added.

The PMI is a composite index based on five of the individual indexes with different weights: new orders, output, employment, suppliers’ delivery times and stock of items purchased. –