November 01, 2024 at 01:45AM
Moves into expansion at 50.3
expected 49.7, prior 49.3
Summary:
PMI Growth: Caixin China Manufacturing PMI rose to 50.3 in October, signalling sector expansion.
Supply and Demand: Both improved, with new orders at their highest since June and output growth steady.
Inventories: Manufacturers increased purchases and stock levels in response to market recovery.
External Demand: Export orders remained weak, continuing a three-month contraction.
Employment: Employment fell for the second month, with widespread job cuts, especially in investment goods sectors.
Prices: Input and output prices rose slightly due to higher energy and metal costs, ending recent declines.
Supplier Delays: Persistent delays for the fifth month, with transportation and production struggling to meet demand.
Business Confidence: Optimism improved, reaching a five-month high, though still below average.
New Policies: Policies from late September aimed to stabilize demand and foster optimism, though labor market pressure remains.
Policy Focus: Sustaining growth in 2024 will require boosting consumer demand, with emphasis on increasing household disposable income.
Stimulus announcement began in China in late September and continued through October.
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Earlier this week we had the the official PMIs, showing slight improvement for manufacturing:
China officeial PMI data: October Manufacturing 50.1 (expected 50.0)
China has two primary Purchasing Managers’ Index (PMI) surveys – the official PMI released by the National Bureau of Statistics (NBS) and the Caixin China PMI published by the media company Caixin and research firm Markit / S&P Global.
The official PMI survey covers large and state-owned companies, while the Caixin PMI survey covers small and medium-sized enterprises. As a result, the Caixin PMI is considered to be a more reliable indicator of the performance of China’s private sector.
Another difference between the two surveys is their methodology. The Caixin PMI survey uses a broader sample of companies than the official survey.
Despite these differences, the two surveys often provide similar readings on China’s manufacturing sector.
This article was written by Eamonn Sheridan at www.forexlive.com.
