China’s official manufacturing PMI inched up to 51.3 in August from 51.2 in July on improved production activity, points out the research team at Standard Chartered.
Key Quotes
“The production sub-index edged up 0.3ppt to 53.3. However, demand remained weak, with the new orders PMI inching down to 52.2.”
“New export orders and import PMIs, in particular, fell deeper into contraction territory. On the other hand, the non-manufacturing PMI rebounded 0.2ppt to 54.2 on solid services sector performance.”
“We expect CPI inflation to have picked up further in August on a food inflation recovery. Vegetable prices surged due to bad weather. Meanwhile, PPI inflation may have eased due to a high base. Industrial production (IP) growth likely edged up on favourable base effects and stronger production.”
“We expect fixed asset investment (FAI) to have rebounded, with a rise in local special bond issuance supporting infrastructure investment. Retail sales likely improved due to solid domestic demand and higher CPI inflation.”
“We expect trade performance to have weakened in August after a better-than-expected outcome in July.”
“Money growth likely picked up given net liquidity injection from the central bank and fiscal spending.”
“Growth in total social financing (TSF) may have stayed stable, with relatively high loan growth offsetting shrinking shadow banking.”
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