Investing.com - Financial Markets Worldwide

China PMIs Suggest Moderate Recovery‏

ByDanske Markets
Published 09/02/2013, 03:13 AM
Updated 05/14/2017, 06:45 AM

China's official manufacturing PMI released by China's National Bureau of Statistics (NBS) in August improved to 51.0 (consensus: 50.6, DBM 51.0) from 50.3 in July. The details were strong with new orders improving from 50.6 to 52.4 taking the new order component to its highest level since April 2011. Export orders also improved slightly to 50.2 from 49.0 in July. Inventories were also cut at a slightly faster pace in August, so the new order-inventory balance remains healthy and suggests continued improvement in the NBS manufacturing PMI in the coming months.

The manufacturing PMIs in line with the hard data for July indicates that the Chinese economy has bottomed out, and that it is poised to recover moderately in the coming months driven primarily by stronger domestic demand and an inventory cycle. There is now a clear upside risk to our GDP forecast. In our latest forecast we have assumed that GDP growth will improve only marginally to 7.0% q/q AR in both Q3 and Q4 from 6.8% q/q AR in Q2 13. The current levels of the manufacturing PMIs, and the expected improvement in the manufacturing PMIs in the coming months, suggest GDP growth in the 7.5-8.0% range in Q3 and Q4.

The current signs of stabilisation in China should eventually prove positive for the sentiment towards emerging markets in general. Sentiment towards emerging markets has been extremely negative as the region has been caught up in fears of a hard landing in China, expectations of tighter liquidity conditions for emerging markets when the Fed starts tapering its QE programme, and recently fears of a prolonged war in Syria.

To Read the Entire Report Please Click on the pdf File Below.

Latest comments

Loading next article…
Install Our App
Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2025 - Fusion Media Limited. All Rights Reserved.