China HSBC flash PMI ticks up from August low

Manufacturing activity in China stabilised in September after hitting a nine-month low in August, even though output dipped to its lowest level in 10 months, a survey of factory managers showed on Thursday.

The HSBC Flash China manufacturing purchasing managers’ index (PMI) ticked up to 47.8, from 47.6 in August. There was a broad steadying across the sub-indexes in the survey.

But while the economy may not have worsened in September, there were few signs of a fast turnaround. Rather, the PMI, which provides the first glimpse of September’s conditions for Chinese industry, seems to point to a month in which a slide was halted, but not reversed.

“China’s manufacturing growth is still slowing, but the pace of slowdown is stabilising. Manufacturing activities remain lacklustre, thanks to weak new business flows and a longer than expected destocking process,” Qu Hongbin, chief economist for China at HSBC, said in a statement accompanying the survey.

“This is adding more pressure to the labour market and has prompted Beijing to step up easing over the past weeks. The recent easing measures should be working to lead to a modest improvement from Q4 onwards.”

China unveiled a series of measures last week to help stabilise export growth, including faster payment of export tax rebates and boosting loans to exporters.