China’s Manufacturing Activity Improves despite Trade Concerns



China’s manufacturing purchasing managers’ index

In March, China’s manufacturing PMI (purchasing managers’ index) indicated a solid rise in manufacturing activity, rising to 51.5 from 50.3 in February. It beat the market expectation of 50.5.

March’s PMI figure represented the strongest improvement in the last three months. Some of the key drivers of China’s manufacturing PMI in March were as follows:

  • Production volume and output improved at a higher rate, rising to 53.1 from 50.7 in February.
  • New orders rose to 53.3 from 51.0 in February.
  • Export orders rose to 51.3 from 49 in February.
  • Employment in the manufacturing sector declined less, standing at 49.1 compared with 48.1 in February.

The stronger improvement in China’s manufacturing activity signals that client demand improved solidly despite trade war concerns. Although global markets tumbled in March as US-China trade war concerns rose, the iShares MSCI Emerging Markets ETF (EEM) rose 0.55%.

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Performance of major ETFs in March

The iShares MSCI China ETF (MCHI) and the Xtrackers Harvest CSI 300 China A ETF (ASHR), which track China’s (YINN) (FXI) economy, fell 0.99% and 0.01%, respectively, in March. In the next part of this series, we’ll analyze China’s service PMI in March.


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