In September, Caixin'S PMI Of China'S Manufacturing Industry Dropped Slightly To 53, And Foreign Demand Employment Continued To Improve

With the recovery of economic activities at home and abroad, the Caixin Purchasing Managers Index (PMI) of China's manufacturing industry published on September 30 recorded 53, down 0.1 percentage point from August, indicating that the manufacturing industry's prosperity has further improved.

This trend is not consistent with the Bureau of statistics manufacturing PMI. 5% higher than the National Bureau of manufacturing statistics.

The output of the manufacturing industry has been in the expansion range for seven consecutive months. In September, the production index dropped slightly in the expansion range, but remained stable. The survey sample enterprises generally reflected that as the impact of the epidemic continues to decline, customer demand increases, new business volume increases, and manufacturers increase production accordingly.

The new orders index again recorded the highest since February 2011, and was in the expansion range for four consecutive months. The survey shows that the market recovery, product demand growth, driving up sales. Due to the relative improvement of overseas epidemic situation, the restrictions on City closure slowed down, and foreign demand rebounded accordingly. In September, the index of new export orders recorded the highest since September 2017, and was in the expansion range for two consecutive months.

The increase of new orders led to the continuous rise of enterprise backlog. The backlog index was almost the same as that in August, and it was in the expansion range for four consecutive months. In September, the employment index rose to the expansion range, but the growth rate was slight. It is reported that some enterprises have expanded their employment due to the increase of orders, while others have not filled in the vacancies after the voluntary resignation of employees.

The increase in new orders also led manufacturers to continue to increase procurement. The inventory index of raw materials was in the expansion range for four consecutive months, close to the seven-and-a-half-year high set in July. The survey sample shows that the increase of production demand and the increase of orders are the main factors leading to the increase of inventory. The increase in output led to the inventory index of finished products in the expansion range for two consecutive months, but the growth rate was slight.

Due to the general rise of raw materials prices, the purchasing price index of raw materials has been in the expansion range for four consecutive months, which is higher than that in August. Manufacturers continued to raise prices slightly, but less than in August. Some manufacturers have raised the ex factory prices of their products due to rising costs, but others say that the competition for new business has intensified, weakening the overall pricing power.

Manufacturers' confidence in production prospects for the next 12 months has increased, with optimism rising to the highest level in nearly three months. The industry's expected output growth is generally due to the belief that market conditions and customer demand will continue to recover from the impact of the new epidemic.

Wang Zhe, a senior economist at Caixin think tank, said that after the outbreak of the new crown epidemic, supply and demand on both sides of the supply and demand have improved simultaneously, the economy has accelerated to recover, and the overseas demand has greatly strengthened, which forms a supplement to the domestic market. The continued high prosperity of manufacturing industry will alleviate the policy pressure in the next stage. But at the same time, the employment situation is still not optimistic, and the improvement of employment still depends on the longer-term recovery of economic prosperity and the more stable internal and external environment. For some time to come, there will still be great uncertainties in the recurrence of overseas epidemics and the US election, and the construction of a new development pattern of mutual promotion of domestic and international dual circulation is still facing great challenges.