China: Manufacturing PMI stabilizes at low levels in June amid escalating trade tensions
June 30, 2019
The manufacturing Purchasing Managers’ Index (PMI) published by the National Bureau of Statistics (NBS) and the China Federation of Logistics and Purchasing (CFLP) stabilized at May’s 49.4% in June. Moreover, the print slightly undershot the 49.5% expected by market analysts. As a result, the index remains below the 50.0% threshold that separates expansion from contraction in the manufacturing sector.
June’s reading reflected declines in output and new orders, while purchasing activity ticked up significantly. The employment sub-index declined to an over 10-year low, while the supplier delivery time index declined in the same month. Against a backdrop of escalating trade tensions between China and the United States, export orders fell further in June. Moreover, input prices—a reliable leading indicator for inflation—fell below the 50.0% threshold, likely reflecting the recent drop in prices for some key commodities, such as oil.