The official Chinese PMI for November hit a 13 month high as the country appears to be avoiding a hard landing. China experienced a year straight of contraction in PMI readings that coincided with a slip in Chinese GDP to its slowest growth in 3 years. At 50.5 this month’s reading is just barely above the expansion line, but a definite improvement off the recent lows seen earlier this year. Markit Economics has more details on this month’s data:
Key points
- Output up for first time since July
- Solid growth of new export orders
- Purchasing activity continues to pick up
Commenting on the China Manufacturing PMI survey, Hongbin Qu, Chief Economist, China & Co-Head of Asian Economic Research at HSBC said:
“The final November manufacturing PMI stood at a 13-month high of 50.5 on increasing new business and expanding production. This confirms that Chinese economy continues to recover gradually. We expect GDP growth to rebound modestly to around 8% in 4Q as the easing measures continue to filter through.”
Cullen Roche
Mr. Roche is the Founder of Orcam Financial Group, LLC. Orcam is a financial services firm offering research, private advisory, institutional consulting and educational services.
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Chinese PMI up, but Shanghai & Hang Seng equity indices down. Why? It appears that investors in China see some weaknesses that are not reflected in the PMI. Shanghai has been in a bear market for a while, and no obvious signs of a bottom there yet.