China's Caixin Manufacturing PMI contracts to 49.2 in August, misses estimates
China's August Caixin manufacturing PMI came in at 49.2 vs. 50.2 expected and July’s 50.3, showing that the country’s manufacturing sector has slipped back into contraction.
On Tuesday, China's official manufacturing PMI fell further to 50.1 in August from 50.4 seen in July, the National Bureau of Statistics (NBS) reported.
Comments from Dr. Wang Zhe, Senior Economist at Caixin Insight Group
“The Caixin China General Manufacturing PMI came in at 49.2 in August, down from 50.3 the previous month and falling into contractionary territory for the first time since April 2020. The reappearance of Covid-19 clusters in several regions beginning in late July has dealt a blow to manufacturing activity.”
"Both supply and demand in the manufacturing sector shrank as the Covid-19 outbreaks disrupted production. The gauges for output, total new orders and new export orders all dropped into negative territory. Output shrank for the first time since February 2020. Demand for intermediary products and investment goods also dropped, while that for consumer goods was relatively stable. Exports fell amid logistics disruptions and as the pandemic continued overseas.”
Market reaction
AUD/USD keeps its rebound intact despite the downbeat Chinese Caixin PMI data, hovering around 0.7315, as of writing. The spot bounced off lows at 0.7308 after Australian Q2 GDP bettered expectations.
Author
Dhwani Mehta
FXStreet
Residing in Mumbai (India), Dhwani is a Senior Analyst and Manager of the Asian session at FXStreet. She has over 10 years of experience in analyzing and covering the global financial markets, with specialization in Forex and commodities markets.
