Hong Kong: Private sector PMI falls in August
September 3, 2020
The IHS Markit Hong Kong SAR Purchasing Managers’ Index (PMI) edged down to 44.0 in August, from 44.5 in July. As a result, the PMI fell further below the 50-threhold that indicates an improvement in the private sector economy over the previous month.
August’s reading was hampered by an increase in coronavirus containment measures, in particular with the implementation of new limits on the size of public gatherings, and both output and new orders fell sharply in the month. Consequently, businesses scaled back on purchasing activity and reduced inventories further amid the economic uncertainty.
Moreover, businesses confidence remained deeply negative, owing to worries about the impact of the ongoing coronavirus restrictions as well as the US-China trade war tensions. On the price front, although input costs remained broadly stable, companies reduced their prices further in a bid to ramp up sales.
Commenting on what this means for jobs, Bernard Aw, principal economist at IHS Markit, said: " With unused capacity persisting across the private sector, the labour market is set to remain subdued in the coming months."