China Export Outlook Steadies

The world's second largest economy is seeing an improving outlook for exports and industrial activity.

China's official manufacturing PMI remained unchanged from November at 50.2 in December. However, while it was up from the average of 49.7 in January-November 2019, it was below the average of 50.9 in 2018.

According to Nomura, the production sub-index rose to 53.2 in December from 52.6 in November, while the new orders and raw materials inventory sub-indices both eased in December, to 51.2 and 47.2, respectively, from 51.3 and 47.8 in November.

"The new export orders sub-index jumped to 50.3 in December from 48.8 in November, despite a concerted weakening in the manufacturing PMIs for developed markets in December, likely due to the easing of U.S.-China trade tensions around mid-December," said Nomura.

"Note the flash readings of the IHS Markit manufacturing PMIs for the U.S., euro area and Japan eased to 52.5, 45.9 and 48.8, respectively, in December from 52.6, 46.9 and 48.9 in November."

Among price-related supplementary sub-indices, both input and output price sub-indices jumped in December, to 51.8 and 49.2, respectively, from 49.0 and 47.3 in November, against the slumps registered in December 2018 (to 44.8 and 43.3, respectively, from 50.3 and 46.4 in November 2018),

By enterprise size, the PMIs for large and small enterprises fell to 50.6 and 47.2, respectively, in December from 50.9 and 49.4 in November, while the PMI for medium-sized enterprises rose in December, to 51.4 from 49.5 in November, noted Nomura.

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