China's industry under pressure: First decline in eight months!
China's industry under pressure: First decline in eight months!
Chinese industry experienced shrinkage for the first time in eight months in May 2023. The Caixin/S & P Global Purchasing Managers' Index (PMI) dropped to 48.3, which corresponds to a decline of 50.4 in April. This not only marks the first decline since September 2022, but also the lowest value in 32 months. The critical 50s mark serves as a dividing line between growth and shrinkage in the processing industry.
In addition to the Caixin PMI, the official shopping manager index also shows a decline in production activity for the second month in a row. The persistent US tariffs have subdued the global demand and meant that the new export orders declined for the second time in May in May, as quickly as in July 2023. The order inputs have also been sank to the lowest level since September 2022, which has increased the already worrying location.decline in production activities
The production figures in the Chinese factories shrank for the first time since October 2022. Employment in the processing industry has also decreased significantly, as quickly as it was no longer the case since the beginning of 2023. The producer prices have been dropped for six months due to intensive competition on the market. These trends were commented on by Scott Bessent, the Finance Minister of the United States, who found that negotiations in the trade war between the USA and China had "stalled a little".
China's Prime Minister Li Qiang announced that the government is thinking about new political instruments that could also include “unconventional measures”. Despite the current challenges, there is a certain optimism among companies. They expect an improvement in the trade environment, which leads to a more positive view of future production.
important indicators for future developments
The Caixin China General Manufacturing Purchasing Managers' Index is published monthly and is an important indicator of the strength of the Chinese economy. The PMI is based on answers from over 500 shopping managers in the manufacturing industry and records monthly changes compared to the previous month. The index contains five individual indices that together represent the development in accordance with the economic activities.
The data from the survey show that the subindex for orders from abroad was 44.8 in April, the lowest status since 2012. The decline is also directly associated with the effects of the US tariffs on the Chinese economy. The PMI is considered to be the decisive early indicator for analysts and decision -makers who highlight the health constitution of industry.
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| Ort | China |
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