HSBC Holdings PLC said Monday the HSBC China Manufacturing Purchasing Managers" Index, a gauge of nationwide manufacturing activity, fell to a final reading of 48.5 in February from 49.5 in January.
A reading below 50 indicates a contraction in manufacturing activity from the previous month, whereas a reading above indicates expansion, according to MarketWatch.
The final reading was higher than HSBC's preliminary February PMI of 48.3, announced Feb. 20. The preliminary figure is based on 85% to 90% of responses to its PMI survey.
February data signaled the first contractions of both output and new orders at Chinese manufacturers since July 2013, HSBC said, though the rate of contraction was modest. The reading "confirmed the weakness of manufacturing growth," HSBC's chief economist for China, Qu Hongbin, said in a statement. "Signs become clear that the risks to GDP growth are tilting to the downside," he added.
This follows a fall in the government's official purchasing managers" index, published on Saturday, which dropped to 50.2 in February from 50.5 in January.
The HSBC China Manufacturing PMI is based on data compiled from monthly replies to questionnaires sent to purchasing executives in more than 420 manufacturing companies. The HSBC Manufacturing Purchasing Managers Index (PMI) released by the Markit Economics is an early indicator of economic health in the Chinese manufacturing sector. Any reading above 50 signals expansion, while a reading under 50 shows contraction. As the Chinese economy has influence on the global economy, this economic indicator would have an impact on the Forex market.
A reading below 50 indicates a contraction in manufacturing activity from the previous month, whereas a reading above indicates expansion, according to MarketWatch.
The final reading was higher than HSBC's preliminary February PMI of 48.3, announced Feb. 20. The preliminary figure is based on 85% to 90% of responses to its PMI survey.
February data signaled the first contractions of both output and new orders at Chinese manufacturers since July 2013, HSBC said, though the rate of contraction was modest. The reading "confirmed the weakness of manufacturing growth," HSBC's chief economist for China, Qu Hongbin, said in a statement. "Signs become clear that the risks to GDP growth are tilting to the downside," he added.
This follows a fall in the government's official purchasing managers" index, published on Saturday, which dropped to 50.2 in February from 50.5 in January.
The HSBC China Manufacturing PMI is based on data compiled from monthly replies to questionnaires sent to purchasing executives in more than 420 manufacturing companies. The HSBC Manufacturing Purchasing Managers Index (PMI) released by the Markit Economics is an early indicator of economic health in the Chinese manufacturing sector. Any reading above 50 signals expansion, while a reading under 50 shows contraction. As the Chinese economy has influence on the global economy, this economic indicator would have an impact on the Forex market.
Source:
Mubasher
