Continuous Expansion Of Manufacturing Industry And Steady Emergence Of Economic Enterprises

Supply and demand are active, steady and steady.

Continuous expansion of manufacturing industry and steady emergence of economic enterprises

In January 2nd, Caixin China's Manufacturing Purchasing Managers Index (PMI), released in December 2019, was 51.5, continuing to be above the ups and downs. The new order index and production index were all expanding for six consecutive months. On the previous day, the National Bureau of Statistics announced the official manufacturing PMI of 50.2%, indicating that the manufacturing industry continued to expand, the market demand continued to grow, and the expansion of production continued to accelerate. The industry pointed out that the leading indicators showed that both the overall situation and the SMEs saw that the manufacturing industry continued to expand and the trend of economic recovery was more significant.

In December, the official manufacturing PMI was 50.2%, and it was located on the ups and downs line for two consecutive months. Manufacturing industry is booming and steadily rising. Zhao Qinghe, Senior Statistician of the National Bureau of Statistics Service Industry Investigation Center, pointed out that production continues to accelerate and demand continues to expand. Both ends of supply and demand of manufacturing industry are more active. The production index is 53.2%, up 0.6 percentage points from last month. Of the 21 industries surveyed, 15 sectors were located in the expansion zone. The new order index was 51.2%, which was higher than the critical point for two consecutive months. In order to meet the needs of production, the purchasing intention of enterprises increased, the purchasing volume index was 51.3%, the ratio increased by 0.3 percentage points.

In addition, the import and export situation has improved, foreign orders have increased significantly, and imports of raw materials have continued to warm up. The new export orders index was 50.3%, up 1.5 percentage points from last month, the first time since June 2018, it has expanded to the expansion interval, the import index is 49.9%, the annulus ratio has increased 0.1 percentage points, and has been rising for two consecutive months. The supply and demand situation has also improved. Both the main raw material purchase price index and the ex factory price index have both picked up.

Zhao Qinghe also said that the transformation and upgrading continued to push forward the growth of new industries. The PMI of high-tech manufacturing, equipment manufacturing and consumer goods industries were 52.8%, 51.3% and 51.4%, respectively, higher than the total 2.6, 1.1 and 1.2 percentage points of manufacturing industry, and for 3 consecutive months in the expansion area, and the prosperity level continued to rise.

PMI, which is mainly aimed at small and medium-sized enterprises, has shown positive changes. Zhong Zhengsheng, chairman and chief economist of the new financial think-tank, said that the new order index has been expanding for six consecutive months. Manufacturers generally say that this is related to the increase in customer numbers, demand improvement and the advent of new products. The expansion of new business is still faster. Corporate confidence also showed positive changes, and the December output index rebounded slightly in the future. New product innovation, capital investment and company expansion plan support the growth expectation of the industry.

Many agencies continue to value the manufacturing and economic trends. "Production index further improved and new orders maintained at a high level, reflecting stable investment, improved consumer demand, mitigation of external environmental uncertainties, and slowing down of inventory processes, together supporting the confidence of enterprises." Qin Tai, a senior analyst at Shen Wan Hongyuan, pointed out that

"Production and demand indicators show good performance at the same time, and the margin strengthens the trend of stabilizing and recovering the short period of the current economy." Huang Wentao, chief analyst of CSC's macro fixed income, said.

Li Chao, chief macro researcher at Huatai, also believes that in November and December, PMI continued to strengthen. The signal of economic stabilization has already appeared. With the countercyclical policy being further pushed forward, the economic recovery in the first quarter of 2020 is expected.