Customize Consent Preferences

We use cookies to help you navigate efficiently and perform certain functions. You will find detailed information about all cookies under each consent category below.

The cookies that are categorized as "Necessary" are stored on your browser as they are essential for enabling the basic functionalities of the site. ... 

Always Active

Necessary cookies are required to enable the basic features of this site, such as providing secure log-in or adjusting your consent preferences. These cookies do not store any personally identifiable data.

No cookies to display.

Functional cookies help perform certain functionalities like sharing the content of the website on social media platforms, collecting feedback, and other third-party features.

No cookies to display.

Analytical cookies are used to understand how visitors interact with the website. These cookies help provide information on metrics such as the number of visitors, bounce rate, traffic source, etc.

No cookies to display.

Performance cookies are used to understand and analyze the key performance indexes of the website which helps in delivering a better user experience for the visitors.

No cookies to display.

Advertisement cookies are used to provide visitors with customized advertisements based on the pages you visited previously and to analyze the effectiveness of the ad campaigns.

No cookies to display.

Loading...
Most Recent Stories

CHINA PMI EXPANDS IN DECEMBER, BUT MOMENTUM SLOWS

China’s PMI continued to expand in December, but showed some signs of slowing momentum.  Total output and new orders slowed to their lowest levels in three months while the headline figure showed continuing expansion at 54.4 – down from 55.3 in November.  Despite the slow-down this is still strong historical data.  Input prices continued to rise in December, but also slid to a 3 month low.  Firms in China have had an easier time passing along costs than those in the USA.  The key points from the report:

  • Slower rises in output, new business and backlogs of work.
  • Strongest increase in purchasing for eleven months.
  • Input cost inflation eased, but remained substantial.

Hongbin Qu of HSBC elaborated on the most recent report:

“Inflation rather than growth still remains as the top policy concern, despite the moderation in December’s manufacturing PMI reading. We expect Beijing to continue to relying on quantitative tightening measures to curb inflation and counter the impact of QE2, while modest interest rate hikes are also needed to anchor inflation expectations in the coming months.”

Overall, this is another strong report and no cause for immediate concern, however, given the rising inflation and government attempts to slow price increases the decline in momentum does raise the risk of a more pronounced slow-down in 2011.  As previously mentioned, a Chinese slow-down is likely the greatest risk to the global economy heading into 2011 and 2012.

Source: HSBC

Comments are closed.