Interpretation: China'S Purchasing Manager Index Keeps Expanding In July

On July 31, 2021, the service industry survey center of the National Bureau of statistics and the China Federation of logistics and purchasing released the China purchasing manager index. In this regard, the National Bureau of Statistics Service Industry Survey Center Senior Statistician Zhao Qinghe has carried on the interpretation.

In July, the purchasing manager index of China's manufacturing industry was 50.4%, down 0.5 percentage points from the previous month; The non manufacturing business activity index was 53.3%, down 0.2 percentage points from the previous month, of which the service industry business activity index was 52.5%, up 0.2 percentage points from the previous month; The composite PMI output index was 52.4%, down 0.5 percentage points from the previous month. On the whole, China's economy continues to expand, but the pace has slowed down.

1. The prosperity level of purchasing manager index of manufacturing industry has declined

In July, some enterprises concentrated in the equipment maintenance period. In addition to the impact of extreme weather such as high temperature and flood disasters in some areas, the expansion of manufacturing industry was weakened compared with that of last month, but PMI of most industries remained in the boom range. Main features of the month:

First, supply and demand slowed down to varying degrees. The production index and new order index were 51.0% and 50.9% respectively, down 0.9% and 0.6% compared with the previous month, and the production activity and market demand of the manufacturing industry generally slowed down. From the industry situation, the two indexes of paper printing, culture, education, sports, entertainment products, railway, ship, aviation and aerospace equipment, computer communication electronic equipment and instruments and meters are all in the high prosperity range above 55.0%. The production and operation of enterprises are relatively active, and the industry growth momentum is strong; The two indexes of high energy consuming industries such as petroleum coal and other fuel processing, chemical raw materials and chemical products, ferrous metal smelting and calendering processing were lower than the critical point, and the production and demand decreased.

Second, the import and export boom dropped slightly. The new export order index and import index were 47.7% and 49.4%, respectively, down 0.4% and 0.3 percentage points compared with the previous month. In terms of the industry situation, the new export order index and import index of agricultural and sideline food processing, food and wine beverage refined tea, textile, computer communication electronic equipment and instruments and meters are in the boom range, and the foreign order volume and raw material import volume have increased; The two indexes of wood processing and furniture, ferrous metal smelting and calendering processing, special equipment and other industries are in the contraction range, and the overall import and export landscape is weak.

Third, the price index has rebounded. The purchasing price index and ex factory price index of main raw materials were 62.9% and 53.8%, respectively, higher than 1.7% and 2.4% of the previous month. From the purchasing price index of main raw materials, the purchasing cost of manufacturing industry generally rose, among which, petroleum coal and other fuel processing, chemical raw materials and chemical products, ferrous metal smelting and calendering processing and other industries were all higher than 70.0%. From the perspective of ex factory price index, the value of ferrous metal smelting and calendering industry is 50.3%, slightly higher than the critical point, which indicates that the ex factory price of industrial products is basically stable, and the policy effect of "ensuring supply and price stability" in the iron and steel industry continues to show.

Fourth, the new driving force is developing well. Since this year, PMI of high-tech manufacturing industry and equipment manufacturing industry has always been higher than that of manufacturing industry as a whole. This month, PMI has risen steadily, reaching 55.0% and 52.4% respectively, higher than 0.3% and 0.9% of the previous month, reflecting the sustained and rapid development of high-end manufacturing industry. Among them, the PMI of railway, ship, aerospace equipment, electrical and mechanical equipment, computer communication and electronic equipment, instrumentation and other industries increased by 1.0 percentage points or more than last month, and the industry expansion accelerated.

Fifthly, the prosperity of large enterprises has remained stable, and the small and medium-sized enterprises have declined. The PMI of large enterprises was 51.7%, which was the same as that of the previous month and 1.3 percentage points higher than that of the manufacturing industry as a whole. The PMI of small and medium-sized enterprises were 50.0% and 47.8%, respectively, lower than 0.8% and 1.3% of the previous month. In the survey, some small and medium-sized enterprises reported that the recent rise in raw material costs, the reduction of orders, and the increase in the pressure on payment collection have caused pressure on the production and operation of enterprises.

2. The index of non manufacturing business activities fell slightly

In July, the non manufacturing business activity index was 53.3%, slightly lower than 0.2% of the previous month, and still remained above the critical point, indicating that the non manufacturing industry as a whole maintained a stable expansion.

The outlook of the service industry has increased. Driven by summer consumption and other factors, the business activity index of the service industry increased by 0.2 percentage points to 52.5% compared with the previous month, indicating that the service industry is recovering. From the industry situation, among the 21 industries surveyed, the business activity index of 18 industries is in the expansion range, 6 more than that of the previous month, and the prosperity of the service industry has expanded. Among them, the business activity index of air transportation, accommodation, catering, ecological protection and environmental management industries increased by more than 10.0 percentage points compared with the previous month, the release of market demand accelerated and the total business volume increased rapidly; Monetary finance, insurance and other industries fell by more than 9.0 percentage points, and business expansion slowed down. From the perspective of market expectation, the expected index of business activities is 60.1%, which has been in the high level of 60.0% for six consecutive months. Service enterprises are optimistic about the future of business development in the near future. Among them, the expected business activity index of railway transportation, air transportation, postal express, telecommunications, radio and television and satellite transmission services, Internet software and information technology services is above 64.0%, Both are higher than the overall service industry, and the related industries are expected to continue to maintain a rapid growth trend.

Construction industry high callback. Affected by adverse weather factors such as high temperature and rainy weather, flood disaster and other adverse weather factors, the business activity index of the construction industry fell to 57.5%, lower than 2.6% of the previous month, reflecting the slowdown of the construction industry production growth. Among them, the business activity index of civil engineering construction industry, which is mainly outdoor operation, dropped significantly, 4.9 percentage points lower than that of last month, accounting for 54.4%. From the perspective of enterprise employment and market expectations, the employee index and business activity expectation index were 52.1% and 64.0%, respectively, up 1.8% and 0.8% compared with the previous month, indicating that the demand for labor in the construction industry continues to grow, and the enterprises' confidence in the future development of the industry has increased.

3. The expansion of comprehensive PMI output index slowed down

In July, the comprehensive PMI output index was 52.4%, lower than 0.5% of the previous month, indicating that the expansion rate of production and operation activities of Chinese enterprises slowed down. The manufacturing production index and non manufacturing business activity index which constitute the composite PMI output index are 51.0% and 53.3% respectively.