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Hong Kong PMI May 2024

Hong Kong: Private-sector PMI falls in May

The S&P Global Hong Kong SAR Purchasing Managers’ Index (PMI) fell to 49.2 in May from 50.6 in April. As a result, the index moved below the 50.0 no-change threshold, and signaled a deterioration in private-sector operating conditions compared to the previous month.

The downturn in the latest PMI reading came amid the fastest declines in output and orders since September 2022. Survey respondents attributed the fall in sales to rising competition and subdued economic conditions, with the construction sector experiencing the sharpest drop in new business and manufacturers leading the decline in output. Additionally, export conditions worsened, with a solid decrease in new business from mainland China and abroad.

On the pricing front, average input costs continued to rise in May, driven by higher wages from salary adjustments. However, in an effort to support sales, firms lowered their average selling prices for the first time since February 2022. Finally, overall sentiment in the Hong Kong SAR private sector remained pessimistic, with the wholesale and retail sectors being particularly downbeat. Firms cited heightened competition, rising prices, and softening economic conditions as major concerns clouding the outlook for future business activity.

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