China's manufacturing sector shows signs of fresh improvement in Aug

Source:China Sport ShowRelease time:04-Sep-2023Clicks:

Article From：SGB Media

China's manufacturing sector showed signs of fresh improvement in August as its purchasing managers' index (PMI) came in at 49.7, up from 49.3 in July, according to the National Bureau of Statistics (NBS). The key indicator went up for a third straight month.

The headline, seasonally-adjusted Caixin China general manufacturing PMI—a composite indicator compiled by S&P Global and designed to provide a single-figure snapshot of operating conditions in the manufacturing economy—rose from 49.2 in July to above the neutral 50 threshold at 51 in August.

The non-manufacturing sector sustained its vibrancy, indicating strengthening economic momentum, a state-controlled news agency reported.

Among the 21 surveyed industries, 12 reported expansion in August, up from 10 a month earlier. There was an overall improvement in the manufacturing climate, NBS statistician Zhao Qinghe said.

The sub-index for production and new orders in the manufacturing sector stood at 51.9 and 50.2, respectively, up by 1.7 and 0.7 percentage points from July figures.

Insufficient market demand is still the major problem faced by enterprises in the manufacturing sector, said Zhao.

Supporting the improvement in overall business conditions was a renewed increase in new order intakes, S&P Global said in a release. Companies indicated that firmer underlying market conditions had helped to boost client spending.

The modest upturn in overall sales occurred despite a further drop in new business from abroad in August, suggesting that stronger domestic demand was the main source of growth.

The downturn in new export orders did ease compared to July, however, and was only mild. Companies responded to greater amounts of new work by expanding production during August. Though modest, the rate of output growth was among the best seen over the past year, the press release noted.

Planned company expansions meanwhile supported a fresh rise in employment across China's manufacturing sector in August, noted S&P Global. Though modest, the rate of job creation was the most pronounced since March 2010.

Supplier performance improved slightly in August, following a deterioration in July. Quicker lead times were generally linked to increased material availability and greater supplier capacity.

Expectations regarding the 12-month outlook for output remained positive in August. Manufacturers often hoped that stronger global economic conditions and new product launches would support higher output over the coming months, S&P Global added.