China official PMI to show minimal growth in May
The IMF this week cut its this year economic growth estimate for China to 7.75 per cent from 8 per cent, citing a struggling world economy and abysmal exports growth.
China’s slowing factory sector may have barely grown in May amid lacklustre local and foreign demand, a Reuters poll showed, adding to fears that the world’s second-largest economy is losing steam.
The median forecast of 10 economists polled by Reuters showed China’s official Purchasing Managers’ Index (PMI) likely retreated to 50.1 in May from April’s 50.6 to hover a whisker above the 50-point threshold.
A reading above 50 indicates expanding activity while a reading below that level points to a contraction. The report will be released on Saturday morning.
Evidence has mounted in recent weeks that the economy is fast losing growth momentum as sluggish domestic demand fail to make up for lethargic export sales, dampening hopes for a China economic revival this year.
And there are considerable risks that the PMI could miss even conservative forecasts, especially after last week’s dismal preliminary PMI reading.
“Overall, the economy seems to be slowing so a drop below 50 in the PMI is likely,” said Zhang Zhiwei, a Nomura economist in Hong Kong who forecast the PMI would fall to 49.
