Hong Kong: Private-sector PMI slips in May
The S&P Global Purchasing Managers’ index (PMI) fell from 52.4 in April to 50.6 in May. Consequently, the index remained above the 50.0 no-change threshold, pointing to a continued, albeit moderating, improvement in private sector operating conditions from the previous month.
May’s reading was driven by the slowest growth in new orders since January. Moreover, export order growth ebbed; while demand from mainland China was the strongest in over a decade, this was not enough to offset softening external demand elsewhere. Consequently, business activity rose at a softer pace, firms reduced their inventory, and employment fell for the first time since late last year. Finally, business sentiment dimmed somewhat.
The latest data suggests that the economic boost from the removal of pandemic restrictions is fading; this is in line with our panelists’ quarterly GDP forecasts, which are for softer sequential growth in Q2.