China's manufacturing sector steady in January - Caixin
Activity in China’s manufacturing sector held steady in January, according to a survey released on Thursday.
The Caixin manufacturing purchasing managers’ index was unchanged at 50.8, in line with consensus expectations.
A reading above 50 indicates expansion, while a reading below signals contraction.
Wang Zhe, senior economist at Caixin Insight Group, said: "Overseas demand picked up slightly with new export orders expanding for the first time in seven months.
"Surveyed companies reported that the largest output increase was in investment goods, while the improvement in external demand was mainly seen in intermediate goods."
On Wednesday, data from the Bureau of Statistics showed that the official manufacturing PMI was 49.2 in January, compared to 49.0 a month earlier.
Duncan Wrigley, chief China+ economist at Pantheon Macroeconomics, said: "The Caixin index is more weighted towards light industry, exporters and private firms compared with the official index. Both PMIs report output readings than for demand, but demand has held up better in the Caixin heading.
"Caixin new export orders rose 1.2 points to 50.7 in January, while overall new orders dipped 1.1 points to 50.8. Both readings are above 50, whereas for the official PMI they are below 50. Caixin production edged down 0.1 point to 52.2, the third straight month above 50. The Caixin PMI reports strong output growth for investment goods - likely on the on the back of stimulus - while exports of intermediate goods were the main driver for higher new export orders.
"The signs of a restocking cycle in the official PMI aren’t so obvious in the Caixin index. Stocks of finished goods slid 0.2 points to 50.2, but stocks of purchases of raw materials and other inputs jumped 1.7 points to 50.7. Note that suppliers’ delivery times surprisingly improved, climbing 1.2 points to 50.3; no apparent disruption from the Red Sea tensions.
"Caixin output prices fell 0.9 points to 49.3, while input prices were barely changed at 50.4. Both the Caixin and official gauges indicate persistent manufactured goods deflation. China’s export prices will likely continue to fall in H1."