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Analysts at Australia and New Zealand Banking group (ANZ) analysts note that the weakness in the Chinese employment sub-index will emerge as a major concern for the Chinese authorities.

Key Quotes:

“All the price sub-indices in China’s manufacturing and non-manufacturing PMI retreated in August, suggesting the likelihood of another y/y contraction in PPI in the month.

China’s steel PMI, which is surveyed by a third party,  also declined to a new low of 44.9 in August from 47.9 in July due to a plunge in steel prices.

The weakness in China’s employment sub-index poses a challenge to policymakers, who have signalled their determination to stabilise domestic demand amid the headwinds from the ongoing US-China trade war.”