Manufacturing index bottoms September orders or has seasonal rebound

According to the data released by the China Federation of Logistics and Purchasing and the National Bureau of Statistics Service Survey Center, China's manufacturing purchasing managers index was 50.1% in July, which fell by 0.1% from June, the lowest point in eight months.

Insiders pointed out that the China Manufacturing Purchasing Managers Index fell slightly in the off-season of production and construction, showing that China's economy is gradually bottoming out, and the trend of stabilization will continue in the later period. However, the current weak demand and the oversupply downward pressure have not yet been eliminated.

At the same time, HSBC Holdings Co., Ltd. announced that the final value of the HSBC China Manufacturing Purchasing Managers Index rose to 49.3 in July, a three-month high. The data shows that China's Manufacturing Purchasing Managers Index was slightly different from the HSBC PMI in July, indicating that China's economy has not stabilized. In addition, the national PMI for manufacturing in July was 50.08, a value of -0.1 on a month-on-year basis, a year-on-year value of -0.6, and 1.4% lower than the average of previous years.

It can be seen that the absolute value of China's manufacturing composite index is weaker than the previous year's average, and the ring index value is stronger than the previous year's average value. Some analysis pointed out that although the ring ratio is stronger than in previous years, it has no positive significance. However, the decline in the PMI index in July continued to narrow, indicating that China's economic growth bottomed out further signs of stabilization. Among them, the decline in the new orders index was significantly reduced, the raw material purchasing index rose slightly, and the finished goods inventory index continued to decrease faster, indicating that the inventory adjustment activity was drawing to a close. At the same time, affected by the effects of various policies on steady growth, it is expected that the market demand growth will increase steadily or slightly in the future, and the reduction in corporate orders is expected to change, and the level of economic growth will tend to be stable or increase slightly.

It is noteworthy that the manufacturing PMI in July had four concerns: First, the new orders index rose slightly after the seasonal adjustment, but import and export orders declined. Second, the inventory of finished products went down, and the combination of upsells of raw materials continued for three months. The contraction in demand for terminals tended to slow. Third, the purchase price index has been falling all the way, and the recent surge in international food prices has not been transmitted to China. Fourth, the polarization of state-owned and private enterprises has been more than one quarter, and the credit easing effect is mainly reflected in state-owned enterprises.

In fact, China’s external demand continues to weaken. In July, the new orders index continued its decline in the first half of the year, and the decline rate has deepened. And in the second quarter, China’s economic growth was lower than market expectations, and the support given by the policy did not reach market expectations, causing the market inertia to decline, but from the perspective of the whole year, the second quarter should be the low point of the economy during the year.

Some studies believe that this year's economic environment has similarities with 2009. The difference is that 2009 is the post-stimulus state and this year it is a slow recovery state. All the data analysis in China's manufacturing industry focuses on the current environment. In this way, the importance of prices in the past retreated under the pressure of inventory. Only if inventory is reduced, demand can be stimulated at low prices. However, in the process of economic restructuring, the fall in demand for backward production capacity cannot be stimulated. At present, the profit point of new industries in our country has not yet been formed, and the process of rising, falling, rising, and falling of inventory is thus long. Moreover, China’s manufacturing orders are not good, purchase prices have dropped substantially and remain low, and the inventory index has dropped to 48, reflecting that the main problems of China’s current economic insufficiency and low profits continue.

Thanks to the various support policies of the country, the production of enterprises is still continuing and employment is still stable. However, based on the comprehensive value of higher output and stability, due to low orders, the positive significance of comprehensive data is greatly reduced.

In a word, the manufacturing data in July was generally not good, but due to factors such as lower inventory, low prices, and stable demand for raw materials, the impact of data on orders in August was positive. It is predicted that China's manufacturing orders will recover somewhat in August and are likely to rise by more than 1 percentage point. First of all, with the seasonal increase in September, the relevant economic data will have a relatively good performance. In the third quarter, the manufacturing industry will also show a steady state, and the PMI will gradually decrease to increase. At the same time, although the effects of the newly introduced policy of stimulating the economy and cutting interest rates in the second quarter have been temporarily poor, they have already been reflected. It is expected that the follow-up government will gradually introduce a structural policy to support the economy, and its effect on economic pull will also be in the third quarter. Gradually emerged. However, from a long-term perspective, the inventory costs and profit pressures formed in this small cycle will weaken the recovery energy in the third quarter. The re-stimulation of policies will also prolong the cycle of low prices and low growth.