The latest reading of China’s Manufacturing PMI was released and here’s the highlights of the report:
Manufacturers in China saw a renewed improvement in overall operating conditions in February, with output and total new orders both expanding at faster rates. However, latest data indicated that external demand was relatively weak, with new export business declining for the first time in 10 months. Meanwhile, average input costs declined sharply over the month, as companies continued to benefit from lower costs for oil and oil related products, which contributed to a solid fall in prices charged.
The Final reading of the PMI posted a result of 50.74 which represents a slight marginal growth from the 49.7 from last month and the 50.1 from the Flash reading, also it’s the first time it has grew from last October.
The renewed improvement in overall operating conditions was supported by a stronger expansion of output in February. Though modest overall, it was the quickest increase in production since last August. According to panellists, greater client demand led firms to raise output over the month, as highlighted by a stronger expansion of total new orders. Data suggested that firmer domestic demand had helped to boost new business, as new export work declined moderately for the first time since April 2014. Chinese manufacturing employment declined again in February. That said, the rate of job shedding eased to a fractional pace that was the slowest in the current 16- month sequence. Meanwhile, increased new orders contributed to a greater amount of unfinished business in February, with the rate of expansion quickening slightly since the start of the year. Stronger client demand encouraged the first increase in purchasing activity since last October in February. However, the rate of growth was only slight. Greater purchasing activity contributed to a renewed increase in inventories of inputs in February, albeit modest. A number of monitored companies also mentioned purchasing and storing more inputs to take advantage of lower prices for some raw materials. Chinese goods producers saw a further decline in average input costs in February. The rate of deflation remained sharp, despite easing since January’s 70- month record. Prices charged fell for the seventh successive month and at a solid rate.