Caixin China March manufacturing PMI falls to 48.1 on lockdowns

SINGAPORE (ICIS)–Caixin’s China manufacturing purchasing managers’ index (PMI) fell to 48.1 in March from 50.4 in February, as output faltered on the back of lockdowns in several cities to curb COVID-19 outbreaks, the Chinese media firm said on Friday.

A PMI reading above 50 indicates expansion in the manufacturing economy, while a lower number denotes contraction.

March production at Chinese factories posted its steepest contraction in 25 months, while new orders fell at the sharpest rate since February 2020 on waning domestic and foreign demand, Caixin said.

“The pandemic, and difficulties shipping items to clients, as well as greater market uncertainty due to the Ukraine war had dampened sales,” it said.

Greater market uncertainty and lower sales led firms to cut back on their purchasing activity, though the rate of contraction was only marginal, Caixin said.

At present, China is facing the most severe wave of outbreaks since the beginning of 2020,” said Wang Zhe, senior economist at Caixin Insight Group.

“Policymakers are facing double challenges of ‘precision’ – improving the level of precision of epidemic control measures, to strike a balance between maintaining the normal order of production and life and guarding safety and health of the people; ensuring fiscal policy and monetary policy are implemented precisely,” Wang added.

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