China’s PMI Was 49.9 Percent in July

China's manufacturing purchasing managers index (PMI)National Bureau of Statistics of China 2016-08-03 16:22. Department of Service Statistics of NBS. China Federation of Logistics and Purchases (CFLP). In July 2016, China’s manufacturing purchasing managers index (PMI) was 49.9 percent, a decrease of 0.1 percentage point over last month, and was lower than the threshold.

In view of the sizes of enterprises, the PMI of large-sized enterprises was 51.2 percent, increased 0.2 percentage points month-on-month, and continued to be higher than the threshold; that of medium-sized and small-sized enterprises were 48.9 and 46.9 percent respectively, decreased 0.2 and 0.5 percentage points month-on-month, having declined for two consecutive months, and both were lower than the threshold.

Among the five sub-indices composing PMI, the production index, new orders index, supplier delivery time index were higher than the threshold. The employed person index and main raw materials inventory index were lower than the threshold.

Production index was 52.1 percent, a decrease of 0.4 percentage points month-on-month, higher than the threshold, indicating that manufacturing production continued to keep increasing, while the growth rate slowed down.

New orders index was 50.4 percent, decreased 0.1 percentage point month-on-month, and was still higher than the threshold, showing that the growth rate of manufacturing market demand declined slightly.

Employed person index was 48.2 percent, increased 0.3 percentage points month-on-month, lower than the threshold, indicating that the pace of decline of manufacturing enterprises’ labor employment narrowed.

Main raw materials inventory index was 47.3 percent, an increase of 0.3 percentage points over last month, and was still below the threshold, indicating that the pace of decline of manufacturing main raw material inventory narrowed.

Supplier delivery time index was 50.5 percent, a decrease of 0.2 percentage points over last month, still higher than the threshold, indicating that the delivery time of manufacturing raw material suppliers speeded up.

China’s Manufacturing PMI (Seasonally Adjusted)

Unit: %
  PMI  
Production Index New Orders Index Main Raw Materials Inventory Index Employed Person Index Supplier Delivery Time Index
             
2015-July 50.0 52.4 49.9 48.4 48.0 50.4
August 49.7 51.7 49.7 48.3 47.9 50.6
September 49.8 52.3 50.2 47.5 47.9 50.8
October 49.8 52.2 50.3 47.2 47.8 50.6
November 49.6 51.9 49.8 47.1 47.6 50.6
December 49.7 52.2 50.2 47.6 47.4 50.7
2016-January 49.4 51.4 49.5 46.8 47.8 50.5
February 49.0 50.2 48.6 48.0 47.6 49.8
March 50.2 52.3 51.4 48.2 48.1 51.3
April 50.1 52.2 51.0 47.4 47.8 50.1
May 50.1 52.3 50.7 47.6 48.2 50.4
June 50.0 52.5 50.5 47.0 47.9 50.7
July 49.9 52.1 50.4 47.3 48.2 50.5
             

Related Indicators (Seasonally Adjusted)

Unit: %

  New Export Orders Index Import Index Purchase Quantity Index Main Raw Material Purchase Price Index Finished Goods Inventory Index Open Orders Index Production And Business Activities Expectation Index
               
2015-July 47.9 47.8 50.3 44.7 47.4 44.0 52.9
August 47.7 47.2 49.4 44.9 47.2 44.6 54.1
September 47.9 48.1 48.6 45.8 46.8 43.8 53.9
October 47.4 47.5 48.8 44.4 47.2 44.4 52.5
November 46.4 46.7 48.3 41.1 46.7 43.0 48.3
December 47.5 47.6 50.3 42.4 46.1 43.6 44.6
2016-January 46.9 46.4 49.0 45.1 44.6 43.4 44.4
February 47.4 45.8 47.9 50.2 46.4 43.9 57.9
March 50.2 50.1 52.6 55.3 46.0 45.7 62.6
April 50.1 49.5 51.0 57.6 45.5 44.8 60.3
May 50.0 49.6 51.2 55.3 46.8 45.1 55.9
June 49.6 49.1 50.5 51.3 46.5 45.0 53.4
July 49.0 49.3 50.5 54.6 46.8 45.5 55.3
               

Annotations: 

  1. Explanatory Notes

 Purchasing Managers Index (PMI) is an index summarized and compiled through the results of the monthly survey of enterprises purchasing managers. It covers every links of the enterprises, including purchasing, production, logistics, and so on. It is one of the leading indices which was commonly adopted by international society to monitor the macroeconomic trends, and played an important role in forecasting and monitoring. The threshold of PMI is usually using 50 percent as the cut-off point for economic performance. If PMI above 50 percent, it reflects the manufacturing economy is expanding; if less than 50 percent, it reflects the manufacturing economy is in recession.

2.Statistical Coverage

The survey involves 31 divisions of manufacturing sector in the “Industrial Classification for National Economic Activities” (GB/T4754-2011), and 3000 samples.

  1. Survey Methods

 PPS (Probability Proportional to Size) sampling method was adopted in manufacturing purchasing managers’ survey. Using the divisions of the manufacturing sector as the selecting strata, the sample size of each division is proportional to its proportion of the value-added of the division to the total value-added of the manufacturing sector. Within the stratum, the samples are selected according to the probabilities proportional to their principal business revenues of the enterprises.

The survey was organized and conducted by staff members of survey offices, monthly through Online Reporting System of NBS by sending survey questionnaires to the purchasing managers of the selected enterprises.

  1. Calculation Methods

 The questionnaire of manufacturing purchasing managers survey covers 12 questions related to production, new orders, export orders, existing orders, finished goods inventory, purchase, import, purchase prices, raw materials, inventory, employees, suppliers, delivery time, production and business activities expectation and etc.. Diffusion index was calculated for each question, i.e. percentage of positive answers in number of enterprises plus half of the percentage in the same answers.

PMI is a composite index, which was calculated according to five diffusion indices (group indices) and their weights. 5 group indices and their weights are determined in accordance with their leading impact on the economy. Specifically, new orders index weighted 30 percent; production index weighted 25 percent; employees index weighted 20 percent; supplier delivery time index weighted 15 percent; raw materials inventory index weighted 10 percent. Of which, the supplier delivery time index is a converse index, and contrary calculation is needed when combines it into PMI.

  1. Seasonal adjustment

 The purchasing managers’ survey is a monthly survey, the data of the survey fluctuates very much for the influences of seasonal factors. The released PMI composite index and sub-indices are seasonally adjusted data.

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