Corrected: China's official PMI keeps at 51.4 in Nov; manufacturing expands

02 December 2013 03:59 Source:ICIS News

Correction: In the ICIS story headlined “China's official PMI keeps at 51.4 in Nov; manufacturing expands” dated 2 December 2013, please read in the second paragraph … from 54.4 in October … instead of … in November … A corrected story follows.

SINGAPORE (ICIS)--The purchasing managers’ index (PMI) of China maintains its highest level of 51.4 since May 2012 for a second straight month in November, which indicates that domestic manufacturing sector has remained stable-to-firm, industry sources said.

The production sub-index for November rose to 54.5 from 54.4 in October, and purchasing volumes climbed to 53.6 in November from 52.7 in October, according to data from the China Federation of Logistics & Purchasing (CFLP).

The PMI index in November was flat with the figure last month, which shows that the economy would be generally stable in the future. In addition, the increase in the exports orders indicates that export growth would be firm, CFLP analyst Zhang Liqun said.

New export orders index edged up by 0.2 points from the previous month at 50.6, and the import index was at 50.5, higher by 0.5 points month on month, according to the data.

New orders index edged down by 0.2 points to 52.3 in November. Some indices of production and businesses activities showed declines, which reflect that firms still took a cautious attitude on the market outlook, Zhang Liqun added.

Meanwhile, investment bank HSBC announced its November PMI reading for China at 50.8, compared with 50.9 in October.

“November data signalled a further improvement of operating conditions in China’s manufacturing sector, albeit marginal,” HSBC said in a statement, adding that it was the second-highest index reading in eight months.

“Output and new order growth both increased at their strongest rates in eight months in November, but renewed job shedding led to a solid increase in outstanding business,” it said.

The final reading was higher than HSBC's flash November PMI of 50.4.

“China's manufacturing sector kept relatively steady growth momentum in November, as the final manufacturing PMI was revised up from the flash reading on the back of faster new business gains,” HSBC's chief economist for China, Qu Hongbin, said in a statement.

“However, the renewed contraction of employment and the slower pace of restocking activities call for a continuation of accommodative policy. The modest inflationary pressures leave room to do so,” Qu said.

PMI is a barometer of an economy's manufacturing activities, with a reading above 50 indicating an expansion, and a lower number denoting a contraction.

By Viola Pan