Over the weekend we had the official PMIs:

China August Manufacturing PMI 49.1 (expected 49.5), Services 50.3 (expected 50.0)

More detail:

The private, Caixin S&P Global manufacturing PMI is much better, coming in at 50.4.

From the report, in summary:

  • Demand picked up as total new orders resumed growth, with stronger
    demand for intermediate goods
  • Exports declined for the first time in eight
    months
  • Employment remained steady after an 11-month contraction
  • Both input and output prices decreased
  • Lower prices for raw materials such as industrial metals brought down input
    costs
  • Output prices decreased amid sales pressure, with the corresponding
    indicator reaching the lowest level in four months

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China has two primary Purchasing Managers’ Index (PMI) surveys – the official PMI released by the National Bureau of Statistics (NBS) and the Caixin China PMI published by the media company Caixin and research firm Markit / S&P Global.

  • The official PMI survey covers large and state-owned companies, while the Caixin PMI survey covers small and medium-sized enterprises. As a result, the Caixin PMI is considered to be a more reliable indicator of the performance of China’s private sector.
  • Another difference between the two surveys is their methodology. The Caixin PMI survey uses a broader sample of companies than the official survey.
  • Despite these differences, the two surveys often provide similar readings on China’s manufacturing sector.
  • The Caixin services PMI will follow on Wednesday