China’s PMI Growth Dips Toward Zero

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The National Bureau of Statistics of China has announced the nation’s purchasing managers index (PMI) reading for October. It was 50.2, on a scale where 50 is the line between expansion and contraction. The trade war between China and the United States apparently has hurt China’s manufacturing sector.

The bureau reported:

In October 2018, China’s manufacturing purchasing managers index (PMI) was 50.2 percent, a decrease of 0.6 percentage point from last month, the manufacturing industry continually located in the expansion interval, while the pace of expansion has slowed down.

Small companies and the labor force took the brunt of the slowdown. The report showed:

In view of the sizes of enterprises, the PMI of large-sized enterprises was 51.6 percent, decreased 0.5 percentage point from last month, and continued to maintain its expansion generally; that of medium-sized enterprises and small-sized enterprises were 47.7 percent, 49.8 percent, which decreased 1.0 percentage point and 0.6 percentage point respectively from last month, lower than the threshold.

And:

Employed person index was 48.1 percent, decreased 0.2 percentage point from last month, lower than the threshold, indicating that the manufacturing enterprises’ labor employment decreased.

At the current rate of fall off, the major PMI number could slip below 50 in the next month or two.