Industry PMI Photo:VCG

China's private Caixin Manufacturing Purchasing Managers' Index (PMI) reached 50.9 in May, returning to positive territory after two months of decline, reflecting the country's industrial growth resilience.

The private Caixin manufacturing PMI trends in the opposite direction of the official manufacturing PMI of 48.8, which was revealed by the National Bureau of Statistics on Wednesday, while the strong growth of China's services sector lifted the official composite PMI to 52.9 in May.

According to Caixin's report, market supply and demand both returned to expansion territory. The manufacturing production index in May reached the highest level since July in 2022, and the second highest level in the past two years, just after the reading for February 2022.

Companies surveyed said that sales growth was driven by improved market demand and an increase in new buyers, which contributed to a rise in industrial production.

After returning to expansion territory in April, the new export orders index continued to rebound in May, indicating that while foreign demand has kept improving in the past months, though overall growth is not strong.

However, the improvement in market supply and demand did little to increase employment which deteriorated in May, with the employment index falling to its lowest level since March 2020.

Caixin chief economist Wang Zhe said that the latest PMI data showed variability in May as factory activity and employment went in opposite directions. He pointed out that the situation might be rectified through supportive fiscal and employment policies.

Global Times