Hong Kong: PMI picks up in April
May 5, 2022
The S&P Global Purchasing Managers’ Index (PMI) jumped to 51.7 in April from March's 42.0. Consequently, the index rose above the 50.0 no-change mark, signaling an improvement in business conditions in the private sector from the previous month.
The upturn was driven by output and new orders returning to growth, in line with the easing of Covid-19 restrictions and the distribution of consumption vouchers to citizens. Moreover, business sentiment improved. However, exports fell on lockdowns in mainland China, with the lockdowns also impacting supply chains and causing delivery times to lengthen. On the price front, input prices rose on higher wages, raw material and transport costs, which fed through to higher output prices.
Commenting on the latest PMI reading, Jingyi Pan, an economist at S&P Global, noted:
“Some sense of cautiousness was visible through the fall in hiring and purchasing activities in April and it will be important to see the demand growth translate to improvements in these. That said, sentiment in the private sector turned positive for the first time since December 2021, marking a turnaround in business confidence. “Supply constraints remained a relevant issue with longer lead times and higher costs weighing on firms. These remain trends to observe given the potential to limit future output.”