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Hong Kong PMI February 2024

Hong Kong: PMI indicates deterioration in private-sector business activity in February

The S&P Global Hong Kong SAR Purchasing Managers’ Index (PMI) fell to 49.7 in February from 49.9 in January. As a result, the index moved further below the 50.0 no-change threshold, and signaled a faster deterioration in private sector operating conditions compared to the previous month.

The decline was primarily driven by a reduction in incoming new business. Moreover, new orders from international markets and mainland China fell. As a result, production declined, with the manufacturing sector experiencing the most significant drop in output. Additionally, purchasing activity decreased in line with the fall in demand, contributing to reduced pressure on supply chains—as indicated by the first shortening of suppliers’ delivery times in three months.

Despite facing a quicker rise in costs, including shipping, raw materials and wage costs, firms largely refrained from passing these onto consumers, leading to a slowdown in output price inflation. Business sentiment remained pessimistic, influenced by concerns over soft economic conditions and potential dampening of demand over the next 12 months.

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