Manufacturing continues to expand moderately

The May Finance New China Manufacturing Purchasing Managers Index (PMI), released on June 3, recorded 50.2, which was the same as April and was in an expansion range for three consecutive months. This means that China's manufacturing industry is still expanding moderately. From the sub-index point of view, the new export order index rose again to the expansion interval, the new order index rose slightly in the expansion interval, the employment index rose slightly, the raw material inventory index and the raw material purchase price index rose in the expansion interval. The data shows that the total number of new orders has increased further, which keeps PMI data expanding. New business grew slightly faster in May than in April when new export orders resumed to grow well. According to the respondents, the release of new products and stronger external demand led to the growth of new orders in May. Manufacturing output stabilized in May after a slight increase last month. The increase in the total volume of new acquisition business has prompted manufacturers to resume their purchasing activities, which is the first time in five months that purchasing activities have expanded. Purchasing inventory remained basically flat for the second month in a row. However, in order to deliver new orders, the manufacturer increased the use of existing inventory, resulting in a further decline in finished product inventory.

In addition, new orders increased and backlog increased in May, but manufacturers remained cautious about hiring, and the scale of hiring declined slightly for the second consecutive month. Data in May showed that the average input cost of Chinese manufacturing industry increased slightly, slowing down significantly from the same period last year. Prices of manufactured products were flat with last month, and many manufacturers said that market competition was under great pressure.

"Manufacturing industry keeps a moderate expansion trend." Zhong Zhengsheng, chairman and chief economist of Monita Research, a financial think tank, said that the index of new orders rose slightly and new export orders rebounded significantly to the highest level in the year. The output index has fallen further, but it is still in an expansion range. Purchasing inventory index rose slightly to above the boom and bust line, finished product inventory index also rose slightly, but still in the contraction zone. Reflecting that the inventory level of enterprises is still at a low level, the willingness of enterprises to replenish their warehouses has increased. The input price index is slightly upward, in the expansion range; the ex-factory price index is slightly downward, falling on the ups and downs line, and the price of industrial products is stable as a whole. Overall, China's economy grew steadily and remained resilient in May. In May, China's domestic and foreign demand for manufacturing industry was good, and the price level was stable. Zhong Zhengsheng said that in the future, the confidence of enterprises, residents and capital markets should be stabilized and boosted through vigorous reform and timely regulation. According to Zhang Yu, chief macro-analyst of Huachuang Securities, PMI of small-scale enterprises deserves sustained attention because of their leading perception of external economic and policy environment. In May, the PMI employment index declined, indicating that employment pressure still exists. The State Council has recently set up a leading group on employment work to illustrate the importance it attaches to the next step of stable employment.