Hong Kong PMI June 2017

Hong Kong

Hong Kong: PMI climbs as exports to mainland China surge

July 5, 2017

The Nikkei Hong Kong Purchasing Managers’ Index (PMI) released by IHS Markit came in above the 50-point threshold for a third consecutive month in June, edging up to 51.1 from May’s 50.5. May’s print seemed to confirm that the territory’s private sector expanded in each month of the second quarter, a multi-year first in which expansion in the private sector spanned three consecutive months.

Higher output and an increase in exports supported expansion in the private sector, with sales growth to mainland China accelerating from a month earlier and growing at the fastest pace in more than three years. Moreover, sustained output growth put pressure on both operating capacity and supply chains, with pressure on the former increasing the level of backlogs due by firms for the first time in more than two years. Meanwhile, input prices and wages both increased and consequently hiked input cost inflation for firms. Relatedly, hiring increased as firms sought to adjust to higher demand. Business confidence, however, remained downbeat for another month as new political leadership left firms uncertain about the incoming business climate.

FocusEconomics Consensus Forecast panelists see fixed investment increasing 2.1% in 2017, which is unchanged from last month’s estimate. For 2018, the panel also expects fixed investment to reach 2.1%.

Author:, Economist

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Hong Kong PMI Chart

HongKong PMI June 2017 0

Note: Nikkei Hong Kong Purchasing Managers’ Index (PMI). A reading above 50 indicates an expansion in business activity while a value below 50 points to a contraction.
Source: Nikkei and IHS Markit.

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