Caixin’s December PMI Rises to 51.5

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The China purchasing managers index prepared by financial news provider Caixin has posted a reading of 51.5 for December 2017.

The December reading marks an increase of 0.7 percentage points compared to the previous month, for the most pronounced improvement in four months, serving to signal further improvement to the Chinese manufacturing sector.

China’s manufacturing volume continued to rise at the end of 2017, while the rate of growth reached a three-month high.

The main drivers of output growth included improving sales as well as a continued increase in output volumes.

Total new orders hit their highest level since August, while end-of-year export sales also saw acceleration.

Despite these performance improvements factories continue to shrink their workforces, leading to a further increase in the backlog work volumes, and a slight rise in stockpile ratios compared to the previous month.

Average costs continue to post sizeable increases, yet nonetheless eased to their lowest levels in four months.

According to Caixin’s survey prices for many raw materials are pricing, exacerbating costs for manufacturers, and prompting them to raise the sales prices for products.

Business confidence for the next 12 months saw a slight rebound from the historic low seen in November, yet still remains below the long-term average.

According to manufacturers sector confidence remains low because of expectations that consumer demand will be weak, and concerns over changes to national policy.

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