PMIs rise slower as pressure weighs on economy

Updated 2017-10-10 10:02:53 Shanghai Daily

Expansion in China's manufacturing and services sectors both slowed in September as downward pressure weighed on the economy in the fourth quarter, a private report showed yesterday.

The Caixin China General Services PMI fell to a 21-month low of 50.6 in September from 52.7 in August, according to the survey conducted by financial information service provider Markit and sponsored by Caixin Media.

Business activity and new orders both rose more weakly while confidence in the 12-month outlook for activity fell to its lowest level in 10 months, the report said.

Meanwhile, inflationary pressure was weak across China's services sector as input and output prices both rose marginally last month.

Released earlier, the Caixin China General Manufacturing PMI, an indicator of operational conditions of smaller manufacturers, fell from 51.6 in August to 51 in September.

Production and new orders both expanded weakly, with companies also signalling slower growth in export sales.

"The Chinese economy generally held up well in the third quarter," said Zhong Zhengsheng, director of macroeconomic analysis at CEBM Group. "However, the expansion in both manufacturing and services cooled in September, suggesting downward pressure on economic growth may re-emerge in the fourth quarter."

The official manufacturing purchasing managers' index, released on September 30 by the National Bureau of Statistics, came in at a five-year high of 52.4 last month, up from 51.7 in August and 51.4 in July.

China's non-manufacturing sector grew at the fastest pace since June 2014 in September, with PMI rising to 55.4 from 53.4 in August, the bureau's data showed.

The official and Caixin data diverge because the official PMI surveys cover thousands of large and small companies while the Caixin PMIs cover hundreds of small scale businesses.

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