Eurozone manufacturing PMI has been trending lower since
February, U.S. manufacturing ISM from the same date while China’s
retreat was delayed for one month, testimony to the global economic
slowdown we have been experiencing.
Source: Bloomberg
China will be the first to release data for September with the flash HSBC manufacturing PMI, which is based on 85-90 percent of survey responses, already released on 22 September and showing a reading of 49.4, slightly softer than the 49.9 posted in August and notably still below the 50/50 contraction/expansion threshold. The details behind August’s second month below the 50 mark showed orders contracting at the same rate as July but, perhaps more worrying, new orders showed a faster pace of decline. If we get a final reading below 50 again, this would be the third month in a row and most likely heighten the debate as to whether China is heading towards a hard landing or not.
The official PMI survey, which surveys almost twice the number of companies as the HSBC/Markit survey, has remained resiliently above the 50 mark since February 2009 and analysts note that this is likely because larger state-owned enterprises are included, which might not have been affected to as great a degree by the authorities’ recent tightening campaign. The latest median forecasts suggest a mild pick-up to 51.1 though the range of estimates varies from 50.3 to 52.2. We would prefer to cast our forecast below median estimates at 50.9.
The HSBC PMI manufacturing data is released on 30 September at 0230GMT. The official PMI is released on 1 October at 0100GMT.
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