China’s PMI suffers surprise decline in April despite Beijing’s stimulus efforts
- China’s manufacturing purchasing managers’ index fell in April, suggesting Beijing’s stimulus is having muted impact on the economy
- Manufacturing PMI fell to 50.1 in April, while non-manufacturing PMI fell to 54.3, both missing analysts’ higher expectations
China’s manufacturing purchasing managers’ index fell in April, suggesting the economy is continuing to battle headwinds of the trade war with the United States and sluggish demand.
Non-manufacturing PMI, which covers the services and construction sectors, fell to 54.3, down from 54.8 last month. This was also behind Bloomberg’s poll, which forecast 54.9.
An index reading above 50 is indicative of growth, while anything below 50 is a contraction. While both metrics remained above contraction levels, they point to continued challenges facing China’s economy.
The new data, released by the National Bureau of Statistics (NBS), comes despite stronger than expected gross domestic product figures for the first quarter of 2019, when it expanded by 6.4 per cent year-on-year, the same rate as in the fourth quarter of 2018, beating economists’ forecasts for a deceleration to 6.3 per cent.
The composite PMI, which combines both manufacturing and services activity, fell to 53.4 in April, from 54.0 a month earlier.
The Caixin manufacturing PMI also missed analysts’ expectations and fell from March. April’s reading was 50.2, significantly lower than the previous month’s reading of 50.8 and just above the level that signifies contraction. It was well below the consensus forecast of 50.9.
The Caixin reading is a separate, independent measurement to the official government data, compiled each month by IHS Markit, a research firm.