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Interpretation of the Bureau of Statistics: manufacturing PMI and non-manufacturing business activity index continued to remain above the critical point in July
Jul 31,2020 09:13CST
translation
Source:Bureau of Statistics
The content below was translated by Tencent automatically for reference.

SMM: manufacturing purchasing managers' index and non-manufacturing business activity index continued to remain above the critical point in July.

Zhao Qinghe, Senior statistician of the Service Industry Survey Center of the National Bureau of Statistics, interprets China's Purchasing Manager Index in July 2020

On July 31, 2020, the Service Industry Survey Center of the National Bureau of Statistics and the China Federation of Logistics and Purchasing released the China Purchasing Manager Index. Zhao Qinghe, a senior statistician at the Service Industry Survey Center of the National Bureau of Statistics, interpreted this.

With the effective implementation of the overall epidemic prevention and development policy, China's economic boom continues to recover, and the operation of enterprises continues to improve. China's purchasing managers' index continued to run smoothly in July, with the manufacturing purchasing managers' index at 51.1 per cent, up 0.2 percentage points from the previous month, while the non-manufacturing business activity index and the composite PMI output index were 54.2 per cent and 54.1 per cent respectively, slightly lower than last month's 0.2 and 0.1 percentage points.

I. the purchasing managers' index of the manufacturing industry has been above the critical point for five months in a row.

In July, the manufacturing PMI was 51.1%, continuing the steady upward trend last month. In 17 of the 21 industries surveyed, the PMI was higher than the tipping point, an increase of 3 over the previous month, and the scope of the economy expanded. The main features of this month are:

First, production has generally rebounded. The production index was 54.0%, slightly higher than last month's 0.1 percentage point. From the perspective of the industry, with the exception of chemical fiber and rubber and plastic products, the production index of the other 20 industries is higher than the critical point, among which the manufacturing industries such as textile, clothing and wood processing have risen above the critical point for the first time since the epidemic. In order to meet the needs of production, enterprises have stepped up their procurement efforts, and the purchasing volume index has rebounded significantly this month, to 52.4%, up 0.6 percentage points from last month.

Second, the demand is gradually picking up. The index of new orders was 51.7%, 0.3 percentage points higher than last month, and rebounded for the third month in a row. From the perspective of the industry, the index of new orders for manufacturing industries such as paper printing, electrical machinery and equipment, and computer communications and electronic equipment continued to rise above the critical point, and the momentum of industry recovery continued to strengthen.

Third, the import and export situation continues to improve. As the world's major economies gradually relaxed the quarantine measures to resume economic activities, and a series of stable foreign trade policy measures introduced by China came into effect, manufacturing imports and exports picked up somewhat. This month's new export order index and import index were 48.4% and 49.1% respectively, up 5.8 and 2.1 percentage points from last month.

Fourth, the purchase price index of major raw materials rose to a recent high. The purchase price index and ex-factory price index of major raw materials were 58.1% and 52.2% respectively, up and down from last month. Affected by the pick-up in demand from downstream industries, the prices of upstream products have increased significantly. The purchase price indices of major manufacturing raw materials such as petroleum processing, iron and steel, and non-ferrous metals are all higher than 63.0%, and the ex-factory price indices are all higher than 58.0%.

Fifth, enterprises are expected to take a further turn for the better. The expected index of production and business activities is 57.8%, which is 0.3% higher than that of last month. Enterprises are optimistic about the recovery of the industry in the near future. From the perspective of the industry, the expected index of production and operation activities in the manufacturing industry, such as food and beverage refined tea, medicine, electrical machinery and equipment, is higher than 60.0%, and the labor demand in the above-mentioned industries has increased compared with the previous month, and the employment index is all above 51.0%.

The survey results also show that the PMI of small enterprises this month was 48.6%, down 0.3% from the previous month, and continues to be below the critical point, with the production index and new order index being 49.8% and 46.8% respectively. The supply and demand of small enterprises continue to be under pressure. In addition, some enterprises in Anhui, Hubei, Hunan, Jiangxi and other places reported that the flood disaster led to poor logistics and transportation, plant, equipment, inventory flooding and other problems, affecting production and operation to a certain extent.

II. The non-manufacturing business activity index continues to remain above the critical point.

In July, the index of non-manufacturing business activity was 54.2%, down 0.2 percentage points from the previous month and remained above the tipping point.

The service sector has maintained its recovery. The service industry business activity index was 53.1%, down 0.3 percentage points from the previous month and continued to be above the tipping point. From the perspective of the industry, the business activity index of postal express delivery, accommodation, catering, telecommunications, securities and other industries is higher than last month, and the total business volume has increased. This month, the business activity index of the residential service industry and the culture, sports and entertainment industry ended its five-month contraction trend, rising to 51.1% and 51.9% respectively, higher than 1.9 and 6.1 percentage points last month, indicating that under the effect of a series of policies to promote consumption in various places recently, the agglomeration and contact service industries, which were seriously affected by the epidemic, accelerated their recovery.

The high position of the construction industry rebounded. Infrastructure projects accelerated, and the volume of construction projects maintained rapid growth. The business activity index of the construction industry was 60.5%, up from 0.7% last month, of which the business activity index of civil engineering and construction industry was 62.5%, 3.2 percentage points higher than that of the previous month. In terms of labor demand and market expectations, the construction industry employment index and business activity expectation index are 56.2% and 66.3%, respectively, which remain above 55.0% and 65.0% for four consecutive months.

III. Stable operation of comprehensive PMI output index

In July, the comprehensive PMI output index was 54.1%, slightly lower than 0.1% of the previous month, indicating that the overall production and operation of Chinese enterprises has maintained a momentum of restorative growth. The manufacturing production index and non-manufacturing business activity index, which make up the composite PMI output index, are 54.0% and 54.2% respectively, up and down from the previous month.

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