Posted on 10 Oct 2022
China's Purchasing Managers' Index (PMI) for the domestic manufacturing industry resumed expanding this month after contracting during the prior two months, with the PMI reading edging up by 0.7 percentage point from August, just enough to push it above the threshold of 50 connoting expansion, the latest release by the country's National Bureau of Statistics (NBS) on September 30 showed. The PMI reading for September was 50.1, Mysteel Global notes.
This month, the country's manufacturing industry improved steadily, many thanks to the implementation of a basket of policies to boost economic recovery, Zhao Qinghe, the NBS's senior statistician, highlighted in his analysis. The arrival of milder weather after August's horrific summer heatwave contributed as well, he said.
The key sub-index of production among the Chinese manufacturers recovered by 1.7 percentage points on month to 51.5 in September, also back to expansion mode after two months of contraction, reflecting accelerated production activity with autumn approaching, traditionally a robust season for industry.
In particular, the ferrous smelting and fabrication sector saw its sub-index of production surge to above 54, Zhao highlighted.
Nevertheless, demand for manufactured goods was still sluggish, with the sub-index for new orders continuing to contract for the third month to reach 49.8, despite the sub-index rising by 0.6 percentage point from the prior month.
Enterprises of all sizes saw their PMIs increase this month, with that for medium-sized firms increasing the most by another 0.8 percentage point on month to settle at 49.7, and small-sized companies' PMI was 0.7 percentage point higher on month at 48.3.
Also, the sentiment among the Chinese manufacturers became more optimistic regarding their production and business operations, the NBS data suggested, with the sentiment index scoring 53.4, up by 1.1 percentage points from August's level. Within this group too, the sentiment index among automobile manufacturers stayed high at above 58.
As for the PMI for China's non-manufacturing sector, it posted the third on-month drop in September, falling by 2 percentage points to 50.6, only just within the expansion zone. The sub-index of business activities in the service sector, however, contracted by 3 percentage points on month to 48.9, mainly due to the adverse impact of the COVID-19 outbreak in many regions across the country.
Meanwhile, the domestic construction industry, another component in the non-manufacturing category, saw its business activities sub-index improve notably by 3.7 percentage points on month to 60.2, according to the NBS release.
Source:Mysteel Global
