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China PMI falls to 12-month low

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China PMI falls to 12-month low

Index in contraction territory for second straight month.

Chinese manufacturing fell further into contraction territory in April, according to the flash HSBC/Markit Purchasing Managers Index released today.

The Chinese PMI came in at 49.2 in April, down from 49.2 in March. (Readings above 50.0 indicate expansion.) This signaled a deterioration in the health of the Chinese manufacturing sector.

 Analysts had expected the index to stay flat at 49.6.

“On a brighter note, demand from overseas improved in April."

 “Operating conditions in China’s manufacturing sector deteriorated slightly for the second month running in April, with the flash reading of the PMI falling to a one-year low,” said Annabel Fiddes, Economist at Markit.

“Production increased only marginally, while total new business declined for the second successive month. Relatively weak demand conditions were also highlighted by stronger deflationary pressures in the sector, with both input and output prices falling at faster rates. Meanwhile, job shedding across manufacturing firms was recorded for the eighteenth month in a row.

 “On a brighter note, demand from overseas improved in April, with new export work rising for the first time in three months."

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