China: Manufacturing PMI rises to eight-month high in May
The manufacturing purchasing managers’ index (PMI) published by the National Bureau of Statistics (NBS) and the China Federation of Logistics and Purchasing (CFLP) rose from 51.4% in April to 51.9% in May, which marked the highest reading since September 2017. The result contrasted market expectations of a dip to 51.3%. The index remains above the 50% threshold that separates expansion from contraction in the manufacturing sector, where it has been for nearly two years.
May’s increase came on the back of broad-based gains across sub-components of the index. Output growth expanded at the fastest pace in eight months and demand grew at a healthy rate, as evidenced by stronger new order growth. Meanwhile, the sub-indices for stocks of inventories for raw materials and employment prospects both remained below the 50% threshold, although they edged up slightly. Supplier delivery times decreased slightly. In addition, export orders picked up in the month, showing resilience to trade skirmishes with the United States.
The index for input prices—a gauge for overall inflation—rose notably in May on the back of higher global commodity prices.