Caixin Markit Manufacturing PMI for May

A private survey of the factories sector in China showed Monday that manufacturing activity was slightly better than expected.

The index of Caixin / Markit factory purchase managers for May was 50.2. Analysts polled by Reuters were expecting the indicator to come in at 50. The April PMI was 50.2.

PMI values ​​above 50 indicate expansion, while those below this signal contraction.

Last week, the official Chinese manufacturing PMI for May was 49.4, which is lower than the 49.9 economists polled by Reuters. It was less than the April reading of 50.1. The official non-manufacturing PMI for May was 54.3 – unchanged from April.

Analysts warned that official data from the PMI show that growth in China remains under pressure, despite earlier optimism that Chinese officials have managed to stabilize the world's second-largest economy.

Before the publication of the Caixin indicator, an economist at Mizuho Bank said that the data "will not replace the general feeling of economic pessimism", even if they turn out to be "unexpected resistance".

"Our best guess is that discouragement will grow around China's growth / export forecasts, and that it will spread more widely to the rest of Asia / Australia, in the near term," he said. said Monday Vishnu Varathan, director of the economy and Mizuho's strategy. morning note.

"In addition, the broader technological war between Huawei (and its suppliers and Chinese high-tech companies) is also creating a chill for the prospects not only for exports, but also for a broader commercial activity," he added. .

The PMI is a survey of companies on the operating environment. These data provide a first glimpse of what is happening in an economy, as they are usually among the top economic indicators published each month.

For China, the PMI is one of the economic indicators that investors around the world are watching closely for signs of problems due to domestic headwinds and the ongoing trade dispute between the United States and China.

The official PMI survey usually polls a large portion of large companies and public companies. Another survey, the Caixin indicator, shows a greater diversity of small and medium-sized enterprises.