Shanghai Securities News recently reported that, according to numbers that China’s National Bureau of Statistics just released, the Manufacturing Purchasing Managers Index (PMI) was 47.4 percent in April, a decrease of 2.1 percentage points from the previous month, and the overall prosperity level of the manufacturing industry continued to decline. The PMI of large enterprises was 48.1 percent, a decrease of 3.2 percentage points from March; and the PMIs of medium and small enterprises were 47.5 percent and 45.6 percent. Both decreased by 1.0 percentage points from March. Sub-indices further showed that manufacturing activity slowed significantly, market demand has fallen sharply, inventories of major raw materials continued to decrease, employment of manufacturing enterprises has declined, and the delivery time of raw material suppliers has slowed down significantly.
In the meantime, Caixin also released its Chinese Manufacturing PMI numbers for April. Caixin PMI is a well-respected economic indicator monitored globally by financial institutions. Caixin’s China Manufacturing PMI recorded 46 for April, 2.1 points lower than March, and was in contractionary territory for the second consecutive month, the lowest value since March 2020. This trend is consistent with the National Bureau of Statistics. The various sub-indices of the Caixin PMI showed that both manufacturing supply and demand continued to contract in April. Both the production and the new orders recorded the lowest values since March 2020. Market orders and product circulation were disrupted. Some surveyed companies reported that customers canceled orders due to difficulties in delivery and logistics. New export sub-index in April fell to its lowest level since June 2020. Employment has been in contractionary territory for eight of the past nine months. Inflationary pressures remain high.
PMI (the Purchasing Managers Index) is an indicator of financial activity reflecting purchasing managers’ acquisitions of goods and services. A PMI number below 50 typically reflects a decline.
Source: Shanghai Securities News, April 30, 2022