Hong Kong PMI

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Hong Kong: PMI drops into negative territory in January

February 4, 2015

The HSBC Purchasing Managers’ Index (PMI) fell from 50.3 in December to 49.4 in January. December’s result had marked a five-month high. As a result, the PMI dipped below the 50-threshold that separates contraction from expansion in business conditions.

January’s figure reflected a sizeable deterioration in output and employment, while new business slowed marginally. Moreover, new business from Mainland China fell for the sixth month in a row. This situation suggests renewed worsening business conditions in the island and that the recent political turmoil has taken its toll on the economy.

HSBC analysts pointed out that, “Hong Kong’s economy remains relatively subdued at the start of 2015, with slower growth domestically as well as in Mainland China continuing to weigh on demand. This has meant that firms are still cutting jobs in the private sector and poses a risk to consumption as a source of growth in 2015.”

FocusEconomics Consensus Forecast panelists see fixed investment rising 3.7% in 2015, which is down 0.5 percentage points from the previous month’s estimate. For 2016, the panel expects fixed investment to increase 3.9%.


Author: Ricard Torné, Lead Economist

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Hong Kong PMI January 2015

Note: HSBC 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: HSBC and Markit.


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