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China Daily Website

China's PMI at 8-month low

Updated: 2012-08-01 09:44
( Xinhua)

BEIJING -- China's manufacturing sector expanded at its slowest pace in eight months, with the purchasing managers index for the sector easing to 50.1 percent in July, down 0.1 percentage points from the previous month, according to official survey results published on Wednesday.

The PMI data released by the China Federation of Logistics and Purchasing and the National Bureau of Statistics suggested the manufacturing sector is still expanding even though the growth has slowed.

China's PMI at 8-month low

A reading of 50 percent demarcates expansion from contraction.

However, July's PMI reading was below market expectations. Analysts have forecast that the official data may inch up from one month earlier as the world's second-largest economy is stabilizing.

A flash PMI published last week by HSBC rose to a five-month high of 49.5 percent in July due to increased pro-growth measures.

"The PMI moderation in July was driven partly by seasonal factors," said Cai Jin, vice-president of the CFLP, adding that widespread rain last month slowed progress on many projects, dragging the PMI reading down.

China's PMI at 8-month low 
"July's PMI slowdown was minimal, which suggested the economy is building up a foundation for stabilized growth," Cai said, but warned that "downward pressure still exists."

Manufacturing PMI has kept above the contraction level since November when the reading was 49 percent, with 50.3 percent for December, 50.5 percent for January, 51 percent for February, 53.1 percent for March, 53.3 percent for April, 50.4 percent for May and 50.2 percent for June.

"The decline in PMI data continued to narrow in July, reinforcing signs that the country's economy is stabilizing," said Zhang Liqun, the Development Research Center of the State Council.

China's economy expanded at 7.6 percent in the second quarter, marking the first time that the country's economic growth rate has fallen below the 8-percent mark since the fourth quarter of 2009.

To buoy the economy, China has adopted a string of pro-growth measures, including lowering banks' reserve ratios and interest rates, subsidizing energy-saving household electrical appliances and speeding up approvals for major construction projects.

 

China's manufacturing sectors

China to expand high-end equipment manufacturing sector
Domestic manufacturers expand into new markets
Manufacturing to see more contraction
Manufactures grapple to secure overseas orders
Manufacturers squeezed, need State support

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