International | Mar 01 2010
By Rudi Filapek-Vandyck
As has been the case throughout calendar 2010, China is no longer the provider of upside surprises when it comes to demand for commodities and economic growth. Economists worldwide had expected the country's monthly survey into overall activity among manufacturers to show minor decline – instead they saw a larger than forecast negative surprise.
China's “official” Purchasing Managers' Index (PMI) fell to 52.0 in February from 55.8 in January, it was announced today.
Output and new orders -both aggregate and overseas orders- remained above the threshold of 50 that indicates an expansion of activity. But backlogs of orders, employment and stocks of purchases all fell below the boom-bust line, according to the survey, which is compiled by the China Federation of Logistics and Purchasing (CFLP) for the National Bureau of Statistics.
It was the 12th straight month that the PMI has stood above 50 but the reading was well below the median forecast of 55.45 in a poll by Reuters of 10 economists.
The drop in overseas orders last month probably took most economists by surprise, with the new export orders sub-index falling to 50.3 from 53.2 in January.
A second, independent monthly reading into Chinese manufacturing, published by HSBC, is due later today.