China’s economy is still slowing, and its official purchasing managers’ index (PMI) could hit its lowest level in 9 months for August. Should that happen, it is likely to increase pressure on the country’s central bank to boost easing measures.
Reuters reported Wednesday that, although the country’s official PMI focuses on larger companies owned by the state and generally portrays a more optimistic scenario, an HSBC flash PMI released last week that focuses on smaller private companies with limited access to bank credit indicated bad news for the huge economy, showing that the official rate could hit 50 when it is released Saturday.
While a PMI of above 50 indicates expansion and below 50 indicates contraction, a considerable volume of weaker than expected economic data for July have driven down optimism that the Chinese economy could speed up again.