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China’s March Manufacturing PMI Continued to Decline

Well-known Chinese financial site Caixin recently released its official Chinese Manufacturing PMI index number for the month of March, which was 48.1. The January Caixin PMI was the lowest for the manufacturing sector since March 2020. The manufacturing sector has been affected by the Covid-19 outbreaks in many parts of the country, It weakened significantly in March, while supply and demand contracted, external demand deteriorated, employment remained stable, inflation pressure continued to rise, and market optimism weakened. In the meantime, the Chinese National Bureau of Statistics also reported March that the manufacturing PMI fell below 50, at 49.5, as the government official number. The Bureau indicated that the manufacturing sector prosperity is heading down; market demand has weakened; the inventory of primary raw materials continues to decrease; the employment level has decreased; and raw material supplier delivery times continue to slow.

Caixin PMI is a well-respected economic indicator that financial institutions monitor globally. PMI (Purchasing Managers Index) is an indicator of financial activity reflecting purchasing managers’ acquisition of goods and services. A PMI number below 50 typically reflects a decline.
(1) Caixin, April 1, 2022
(2) National Bureau of Statistics, March 31, 2022