China manufacturing activity under pressure

The HSBC flash China manufacturing purchasing managers’ index (PMI) recorded a reading of 50.0 in November, down from 50.4 in October.

The preliminary data, which is published ahead of final PMI data, making it the earliest indicator of manufacturing sector conditions in China, shows that output contracted for the first time in six months in November.

HSBC revealed that its flash China manufacturing output index was at 49.5 in November, compared to 50.7 in October, with a reading below 50 for the first time since May, indicating a contraction.

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Hongbin Qu, chief economist, China and co-head of Asian economic research at HSBC, said: “Disinflationary pressures remain strong and the labour market showed further signs of weakening.

“Weak price pressures and low capacity utilisation point to insufficient demand in the economy. Furthermore, we still see uncertainties in the months ahead from the property market and on the export front.”

He added: “We think growth still faces significant downward pressures, and more monetary and fiscal easing measures should be deployed.”

November final PMI data will be released on December 1.