Demand recovery is weaker than production, especially the accelerated spread of overseas epidemics has led to a sudden reduction in new export orders, allowing China’s official manufacturing PMI to rebound again in April after a brief rebound last month. Although the PMI remained above the expansion line under the support of domestic demand, the downward pressure on exports has increased significantly. It will take some time for the orders to be replenished. The second impact of the epidemic requires more support from the policy side.
The National Bureau of Statistics of China and the Federation of Logistics and Purchasing (CFLP) jointly announced on Thursday that the leading indicator of macroeconomics-the April official manufacturing purchasing managers index (PMI) fell to 50.8, lower than the median value of Reuters survey estimates of 51, It was also lower than 52 last month.
The index was affected by the economic downturn caused by the outbreak of the new domestic pneumococcal pneumonia epidemic in February. It had a cliff-like decline to 35.7, the lowest level on record.
April manufacturing new orders index was 50.2, down 1.8 percentage points from the previous month, lower than the production index. The new export order index and import index were 33.5 and 43.9, down 12.9 and 4.5 percentage points from the previous month.
“The uncertainty in the import and export market has increased. Foreign epidemics have accelerated, global economic activity has contracted sharply, and China’s foreign trade is facing greater challenges,” Zhao Qinghe, senior statistician at the Service Industry Survey Center of the National Bureau of Statistics, said in the interpretation, “… some manufacturing Industry companies reported a sharp decrease in newly signed export orders, and even orders that have already started production have been cancelled. “
He said that demand recovery was weaker than production. In the 21 industries surveyed, the new orders index of 15 industries such as textiles, textiles, apparel and apparel, and chemical raw materials products was lower than the production index, and the industry demand recovery lags behind production.
“The survey results show that the proportion of companies that reflect insufficient orders is as high as 57.7%, and some companies report weak market demand, product sales are facing difficulties, and order replenishment will take time,” Zhao Qinghe said.
In terms of enterprise scale, the PMI of large and medium-sized enterprises in manufacturing industry in April were 51.1 and 50.2, down 1.5 and 1.3 percentage points from the previous month; the PMI of small enterprises was 51.0, an increase of 0.1 percentage point from the previous month.
China Customs is scheduled to release April foreign trade data on May 7. The Bank of Communications Financial Research Center said in the macro monthly report that global demand has weakened, new export orders have fallen, and export growth has slowed. Exports in April are expected to fall by 20% year-on-year; while falling prices and high bases have caused imports to fall, which is expected to decrease by 23 year-on-year %.
However, despite the decline in the manufacturing PMI, under the promotion of policies to promote the resumption of production and business, the resumption of business, the expansion of resident consumption and the increase of public consumption, the business activities of most industries in the service industry have steadily recovered. The official non-manufacturing business activity index in April It rose further to 53.2, up 0.9 percentage points from the previous month, the second consecutive month of rebound.