Chinese PMI shows improving mood
The heavy Chinese industry sees demand picking up in its own country now that the corona crisis has peaked there, but foreign demand is still under pressure due to the virus outbreak in important export markets.
The indicator rose slightly last month to a level of 50.7 from 49.4 in April. A score of 50 or more indicates growth, below that shrinkage. The Chinese government’s official purchasing managers index, which came out on Sunday, reached 50.6, which is slightly lower than a month earlier. Government figures focus more on large Chinese state-owned companies, while Caixin and Markit focus more on smaller private companies.
In Japan, industry is still going badly. Jibun Bank’s purchasing managers index for Japanese industry stood at 38.4 in May from 41.9 in April. This is the lowest level since 2009. The industry in South Korea also showed contraction, with a level of 41.3. This also applied to other countries in Asia, such as Taiwan and Vietnam.
Economists believe that China’s exports may pick up again gradually in the near future as quarantine measures against the coronavirus are gradually easing in more and more countries. This recovery is likely to take longer because of the severe blows that the corona crisis has caused in major economies such as the European Union and the United States.