China’s temporary return to wild growth reversed itself, as evidence showed once again that its economy cannot be decoupled from the rest of the world. Whatever effects of the global recession might linger around the balance of the world, China has not be able to pull itself from of them with the consumer base within its own borders.
The new PMI data for China, from the National Bureau of Statistics, show an expansion of 50.4 in January, which is barely above the flat line. In December, the number was 50.6.
Another set of numbers that measure the same general trend in China told another story. HSBC said its PMI number showed an improvement in the manufacturing economy, which means that signals are mixed and confused enough to leave the trend completely in doubt.
According to Dow Jones:
Business conditions for Chinese manufacturers showed a significant improvement in January, according to the final reading of the results of a survey by HSBC released Friday. HSBC’s final print of the manufacturing Purchasing Managers’ Index for January came in at 52.3, up from the survey’s initial reading of 51.9, and also higher than the final measure of December PMI at 51.5. A reading above 50 indicates an expansion. The latest data from HSBC marked a divergence from an official gauge of Chinese manufacturing conditions, which put the January PMI at 50.4, weaker than its December reading of 50.6. “A higher reading of January final manufacturing PMI implies that China’s manufacturing activity is gaining further steam on the back of improving domestic conditions,” Hongbin Qu, chief China economist at HSBC, wrote in a statement.