Hong Kong: PMI deteriorates to record low in October
November 7, 2014
The HSBC Purchasing Managers’ Index (PMI) fell from 49.8 in September to 47.7 in October, which marked a record low. Consequently, the PMI sank further below the 50-threshold that separates expansion from contraction in business conditions.
October’s figure reflected strong declines in output and new orders amid disruptions to business activity and softer client demand caused by the ongoing political protests. New work from mainland China also fell in October, although to a lesser degree. Purchasing activity fell to a multi-year low and business cut staffing levels at the fastest rate in 16 months.
HSBC analysts pointed out that, “The slowdown in economic activity in Hong Kong deepened in October as orders and output fell at an accelerated pace. This is also increasingly being felt in the labour market, with the pace of job cuts quickening, posing further downside risk to consumption. There had already been signs that growth was slowing in previous months, and the October PMI confirms the downward trend.”
Author: Carl Kelly, Economist