HSBC Hong Kong PMI rises as mainland orders increase
Reuters in Hong Kong
The HSBC purchasing managers index (PMI) for Hong Kong rose to 50.4 in July from 50.1 in June.
It indicates a marginal improvement in operating conditions in the city’s private sector, although it rose to its highest reading in five months.
Output expanded for the first time since February, but the rate of growth was only slight.
Total new orders received by private-sector firms shrank for the third consecutive month, and the rate of contraction was similar to that recorded in June and marginal.
However, new business from mainland China expanded for the first time since March.
Employment contracted marginally, and the rate of job shedding was the weakest in the last four months.
Purchasing activity shrank after a modest expansion in June. The latest reduction in activity was in line with fewer new orders.
Overall input costs faced by private-sector companies continued to increase, but the rate of inflation eased from June to the second-weakest in 11 months.
“Hong Kong’s economy is stabilising, although it is still not yet back to normal, as the PMI for July only showed a marginal return to overall growth, and new orders remained in contraction,” John Zhu, HSBC’s economist in Asia, said in a statement.
“Still, there was an encouraging rebound in new business from China, which could potentially be sustained given the improving economic data from the mainland of late.”
The HSBC PMI is based on a survey by Markit Group of about 300 firms in industries including manufacturing, services, retail and construction.