Hold on tightly-China PMI December 2009
China’s export order fell in Decemeber 2009 has urged the country to act cautiously optimistic in international markets. The warning comes after China’s PMI readings in Decemebr which is released by the Federation of Logistics and Purchasing (CFLP) said last week.
Although China Purchasing Managers’ Index suggests sustained expansion in industrial activity as the figure surged to a seasonally adjusted 56.6 in Decemenber from 55.2 in the previous month. It was the tenth straight month that the index has stood above the watershed mark of 50, indicating an expansion of activity.
A measure of new export orders fell to 52.6 in December from 53.6 in November and a gauge of purchasing prices increased to 66.7 from 63.4, according to the statement.
China PMI Decemeber 2009_image courtesty of entranceChina.org
Seventeen of 20 industries surveyed reported an expansion in activity, with metal products the strongest and tobacco at the low end.
Today’s figure compares with a record-low 38.8 in November 2008 casued by economic slump in the U.S., Europe and Japan which sent export orders plunging.
“Attention should be focused on the drop in the export- order index, which shows there shouldn’t be premature optimism about an improvement in international markets,” Zhang Liqun, a researcher at the State Council Development and Research Center, said in the statement. “The rise in the purchasing price index shows that production costs for companies are increasing.”
“The forward-looking components of the PMI indicate continued expansion in both domestic and external demand,” said Jing Ulrich, Hong Kong-based chairwoman of China equities and commodities at JPMorgan Chase & Co. “We expect China’s strong economic growth momentum to continue in 2010.”
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