City skyline in China

China PMI November 2023

China: Manufacturing and non-manufacturing PMIs ease in November

The National Bureau of Statistics’ Manufacturing Purchasing Managers’ Index (PMI) fell to 49.4 in November from October’s 49.5, undershooting market expectations. As a result, the index fell further below the 50.0 no-change threshold, signaling a sharper deterioration in manufacturing sector operating conditions compared to the previous month. Weaker readings for new orders and output were behind the decline, more than offsetting a softer fall in job creation.

Meanwhile, the National Bureau of Statistics’ non-Manufacturing PMI clocked in at 50.2 in November, down from October’s 50.6, undershooting market expectations and marking the weakest reading since December 2022. This was due to a decline in services activity more than offsetting an uptick in construction activity. While construction likely benefited from government support measures, services firms were weighed on by subdued domestic and external demand.

On the near-term outlook, Nomura analysts said:

“Despite the raft of stimulus measures announced over the past several months, we believe it is still too early to call the bottom. We expect another economic dip towards end-2023 and spring 2024 due to tapering pent-up services consumption, a deteriorating property sector, slowing external demand and the peak investment growth of the green sector.”

On the implications of the weak PMI readings for monetary policy, United Overseas Bank’s Ho Woei Chen said:

“The Nov PMIs indicated a weaker than expected momentum in China’s economy and further policy measures will still be needed including monetary policy easing. However, the surge in liquidity injections and possible relaunch of the pledged supplementary lending (PSL) facility to policy banks for the urban village renovation and affordable housing programs may delay further rate cuts to 1Q24 or even 2Q24.”

Free sample report

Access essential information in the shortest time possible. FocusEconomics provide hundreds of consensus forecast reports from the most reputable economic research authorities in the world.
Close Left Media Arrows Left Media Circles Right Media Arrows Right Media Circles Arrow Quote Wave Address Email Telephone Man in front of screen with line chart Document with bar chart and magnifying glass Application window with bar chart Target with arrow Line Chart Stopwatch Globe with arrows Document with bar chart in front of screen Bar chart with magnifying glass and dollar sign Lightbulb Document with bookmark Laptop with download icon Calendar Icon Nav Menu Arrow Arrow Right Long Icon Arrow Right Icon Chevron Right Icon Chevron Left Icon Briefcase Icon Linkedin In Icon Full Linkedin Icon Filter Facebook Linkedin Twitter Pinterest