The pace of activity in Chinese factories slowed in August, the release of a pair of official purchasing managers’ indexes (PMI) on Monday confirmed.
The official (PMI) came in at 51.1 in August, according to the National Bureau of Statistics, a tad below expectations for a reading of 51.2 and down from a 27-month high of 51.7 in July. It remains above the 50-mark which separates expansion from contraction.
The final reading of HSBC’s flash manufacturing PMI for August meanwhile fell to a three-month low of 50.2, a dip from the flash reading of 50.3.
There was little reaction in Asian stock markets outside of Australia. Sydney shares widened their gains to 0.5 percent, hitting a more than one-week high, while the Australian dollar barely moved.
The PMI figures follow a slew of disappointing economic data – from manufacturing to credit growth – over the past month despite a burst of government stimulus measures to support the economy.
“The industrial sector is suffering from a drop in new lending, which is making it more difficult to operate and invest. The [PMI] data highlights renewed downward pressure on the Chinese economy emerging in the summer, but it also should prompt more policy easing measures from Beijing,” said Darius Kowalczyk, senior economist and strategist at Credit Agricole.
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