China's two Purchasing Managers' Index (PMI) surveys will be published by the National Bureau of Statistics (NBS) on Wednesday, 31 May 2023.
- at 0130 GMT, which is 9.30pm on Tuesday, 30 May 2023 US Eastern time
China's factory sector is struggling to bounce out of the COVID-19 pandemic-affected slump.
The PMI for the sector is expected to still show contraction in May, barely up from the 49.2 contraction reading in April with momentum still waning. Imports dropped significantly, factory gate prices dropped once again, real estate investment plummeted even more, and industrial output and retail sales fell short of expectations.
Goldman Sachs says that:
- "Underlying growth momentum appears weak ... both the steel production data and our commodity team's channel check suggest sluggish activity growth in the upstream manufacturing sector in May."
The background to the GS comment on steel, is that last week, Dalian iron ore prices fell to their lowest level in nearly six months. Demand for steel in China is subdued and is expected to remain so with a seasonal (summer) slowdown imminent.
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China has two primary Purchasing Managers' Index (PMI) surveys - the official PMI released by the National Bureau of Statistics (NBS) and the Caixin China PMI published by the media company Caixin and research firm Markit / S&P Global.
- The official PMI survey covers large and state-owned companies, while the Caixin PMI survey covers more small and medium-sized enterprises. As a result, the Caixin PMI is considered to be a more reliable indicator of the performance of China's private sector.
- Another difference between the two surveys is their methodology. The Caixin PMI survey uses a broader sample of companies than the official survey. Despite these differences, the two surveys often provide similar readings on China's manufacturing sector.