China PMI

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China: PMI in contraction mode for second consecutive month in February

March 1, 2015

The Purchasing Managers’ Index (PMI) rose slightly from 49.8% in January to 49.9% in February, according to the National Bureau of Statistics (NBS) and the China Federation of Logistics and Purchasing (CFLP), which publish the index. As a result, the PMI now rests below the 50%-threshold that separates contraction from expansion in the manufacturing sector for the second consecutive month. The print overshot the 49.7% that market analysts had expected.

February’s reading reflected deteriorations in three of the five subcategories that make up the index. Both manufacturing output and employment reached their lowest levels in two years, while the supplier delivery times category dipped into the red in February. Conversely, new orders and inventories improved over the previous month. Although input prices—a reliable leading indicator for consumer prices—hit a 3-month high, the variable remains firmly entrenched below the 50%-threshold, thereby signaling strong disinflationary pressures.


Author: Angela Bouzanis, Senior Economist

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China PMI February 2015

Note: Purchasing Managers’ Index. Readings above 50% indicate an expansion in the manufacturing sector while readings below 50% indicate a contraction.
Source: National Bureau of Statistics of China (NBS) and the China Federation of Logistics and Purchasing (CFLP).


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