China: Manufacturing PMI ticks up in August
August 31, 2017
The manufacturing purchasing managers’ index (PMI) rose slightly from July’s 51.4% to 51.7% in August, according to the National Bureau of Statistics (NBS) and the China Federation of Logistics and Purchasing (CFLP) that publish the index. The result was higher than the 51.3% reading market analysts had expected, resting more comfortably than in July above the 50% threshold that separates expansion from contraction in the manufacturing sector.
August’s reading reflected improvements in the two most significant sub-components of the manufacturing PMI—new orders and production—pushing them both further above the 50% threshold compared to July. In contrast, inventories of main manufacturing raw materials and employment levels both dipped further below the 50% threshold in August, and delivery times of main manufacturing raw materials swung below the 50% threshold. As commodities prices recovered in recent weeks, input prices—a reliable leading indicator for overall inflation—rose to an eight-month high in August.
Author: Edward Gardner, Economist