China’s October Caixin Manufacturing PMI comes in, back in contraction, at 49.5
- 50.8 expected, prior was 50.6
From the report, in brief:
- first contraction
since July - slower growth in overall sales
- weak foreign demand
- new export orders shrunk
for four consecutive months - weaker-than-expected sales and the delayed shipment
of goods led to the strongest rise in inventories of
post-production items since September 2015 - manufacturers trimmed staffing levels for the second
straight month, the rate of job shedding the quickest since
May - higher prices for raw materials and oil,
pushed the rate of input inflation ticked up to
nine-month high
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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.
We got the official from the NBS yesterday:
- 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.