CHINA’S manufacturers reported a slowdown in business this month, weighing further on the country’s growth expectations.
The purchasing managers’ index, (PMI) compiled by Markit and HSBC, dropped to 49.2 from March’s 49.6, according to figures released yesterday. Scores below 50 signify a contraction.
Yesterday’s survey showed a rise in new export orders, which may be evidence that the steep decline in exports earlier this year will rebound. However, the export order rise failed to prevent firms from cutting capacity.
“The upturn in exports was insufficient to prevent companies from cutting their headcounts again as factories sought to reduce operating capacity. Volumes of inputs bought also fell, showing the largest monthly decline since March of last year, as firms pared-back production requirements in the face of weaker demand,” said economist Chris Williamson from Markit.
Williamson added that the PMI “raised the possibility of economic growth having lost further momentum compared to the already-weak rate seen in the opening quarter of the year”.