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HSBC China PMI preview value fell to 50.1 in June, the lowest in 11 months

HSBC reported on Thursday that the preliminary data for the HSBC China Manufacturing Purchasing Managers' Index (PMI) preview continued to fall to the lowest level in 11 months, with the output index continuing. Falling to a 11-month low, the effects of China's austerity policy continue to show, and the expansion in the manufacturing sector is almost stagnant.
According to a press release provided by Markit, the initial value of HSBC's manufacturing PMI was 50.1 in June, lower than the final value of 51.6 in May, and continued to be the lowest since July 2010.
Among them, the growth rate of the input price index was the lowest in 11 months, which was 52.1; the output index also fell further to the lowest level in 11 months.
Qu Hongbin, chief economist of HSBC China, said: "The domestic austerity policy and weak external demand have cooled domestic demand, coupled with the process of destocking, which has slowed production growth."
But he pointed out that the fear of a hard landing for China's economy is unfounded, at least the current manufacturing PMI is still in line with the 13% industrial growth rate. And the good news is that in the context of slowing demand, inflationary pressures began to fall in real terms in June.
The sixth increase in the deposit reserve ratio by the People’s Bank of China during the anniversary was also the 12th increase since the beginning of last year. As a result, the deposit reserve ratio of large financial institutions reached a record high of 21.5%. And since October last year, the central bank has raised interest rates four times in a row.
China announced that its consumer price index (CPI) in May reached a new high in 34 months, and affected by weakening external demand and domestic power shortages and destocking, the growth rate of industrial added value declined in May, and consumption growth rate was lower than expected. It is obvious that China's economic growth rate continues to fall.
The PMI preview data sample was collected between June 13-21.
The final PMI for June is scheduled for release next Friday (July 1). The index fell to a seven-month low of 51.7 in February due to the Spring Festival effect. After that, it rebounded slightly, and remained at 51.8 in March and April. The initial value of HSBC's manufacturing PMI fell to a 10-month low in May.
PMI initial data is based on 85%-90% of the total sample size of the monthly PMI survey, and strives to accurately predict the final PMI data, To reflect the trend of monthly economic operations, both PMI preview data and final data are designed to eliminate the impact of seasonal factors on the data.
The preview data compiled by HSBC and Markit was produced based on the preliminary analysis of PMI survey data, which was released about one week earlier than the final PMI data of the same month, and earlier than the publication time of similar statistical data.


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