China’s PMI drops to 52% in Feb, still shows stable economy

01 March 2010 08:36  [Source: ICIS news]

SHANGHAI (ICIS news)--China’s purchasing managers’ index (PMI) dropped by 3.8 percentage points in February to 52.0% from 55.8% in January, but still reflects a stable economy, according to data from the China Federation of Logistics & Purchasing (CFLP) released on Monday.

The new orders index dropped by 6.2 percentage points from January to 53.7%.

“We should pay attention to the drop on the new orders index, that means the export growth is not very stable at present,” said Zhang Liqun, a researcher at the Development Research Centre of the State Council (DRC), in Mandarin.

The PMI production index reached 54.3% in February, down 6.2 percentage points from January, according to the data.

“The PMI data had kept above 50% for 12 months; the Chinese economy is developing stably at a high level after the government’s stimulating package,” according to the CFLP.

The PMI serves as a barometer for the monthly performance of China’s factories and is based on surveys from purchasing and supply managers at more than 700 manufacturers across the country.

A reading of above 50% suggests economic expansion, while one below 50% indicates contraction.

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By: Dolly Wu
+65 6780 4359

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