China: Manufacturing PMI moderates in January
February 1, 2017
The manufacturing Purchasing Managers’ Index (PMI) for China fell from December’s 51.4% to 51.3% in January, according to the National Bureau of Statistics (NBS) and the China Federation of Logistics and Purchasing (CFLP), which publish the index. Despite the decline, the manufacturing PMI still managed to beat the 51.2% that market analysts had expected. Therefore, the index rests comfortably above the 50% threshold that separates expansion from contraction in the manufacturing sector.
January’s reading reflected a deterioration in production, new orders and suppliers’ delivery times. Conversely, employment prospects improved, while inventories were unchanged in the same month. Input prices—a reliable leading indicator for producer prices—moderated slightly from December’s multi-year high, signaling tighter supply conditions and suggesting that overall inflationary pressures are still strong. January data point to a mild deceleration at the outset of the year, though overall manufacturing activity remains robust.