Coronavirus impact on China’s manufacturing not ‘yet fully manifested’ even as factory output cools
- The official manufacturing purchasing managers’ index (PMI) dropped to 50.0 in January, but the survey was conducted before the Wuhan coronavirus outbreak
- Officials warned that survey was conducted before January 20, so ‘impact of pneumonia caused by the new coronavirus has not yet (been) fully manifested’
China’s factory activity cooled slightly in January, although officials and analysts warned the drop does not account for the coronavirus outbreak, which is set to test an economy already growing more slowly.
“Future trends will need further observation,” it added in a statement.
The impact of pneumonia caused by the new coronavirus has not yet (been) fully manifested. Future trends will need further observation
The non-manufacturing PMI – a gauge of sentiment in the services and construction sectors – strengthened to 54.1 from 53.5 in December.
A reading above 50 signals growth in the sector, while a score below 50 indicates a contraction, meaning January’s reading signifies stability, but little expansion. Analysts polled by Reuters had expected the January reading to come in at 50.0.
“I would disregard today’s release,” said Raymond Yeung, chief economist for Greater China at ANZ. “The figure certainly overrates the economic outlook as it does not reflect the interruption due to the outbreak.”