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5 May 2015
China manufacturing PMI signals weak Q2 15 – ING
FXStreet (Barcelona) - Tim Condon of ING, reviews ING’s 7.0% forecast for 2Q15 for a downward revision and further anticipates more easing by the PBoC as the manufacturing PMI painted a soft picture for the Chinese economy.
Key Quotes
“The final HSBC manufacturing PMI for April came in at 48.9, down from in the 49.2 flash. It was the lowest reading in one year. There was a steep decline in the new orders component and smaller declines in the employment and purchasing activity components. The new export orders component, which in the official index fell for a second consecutive month (see figure), increased marginally.”
“We are reviewing our 7.0% forecast for 2Q15 growth for downward revision (Bloomberg consensus 7.0%). We reiterate our forecasts of more housing policy and monetary policy loosening, including a 25bp PBOC policy interest rate cut and a 50bp RRR cut per quarter in 2015, taking the 1-year lending rate to 4.60%, 1-year deposit rate to 1.75% and RRR to 17.5% by yearend (Bloomberg median forecasts 5.10%, 2.25% and 17.5% respectively).”
Key Quotes
“The final HSBC manufacturing PMI for April came in at 48.9, down from in the 49.2 flash. It was the lowest reading in one year. There was a steep decline in the new orders component and smaller declines in the employment and purchasing activity components. The new export orders component, which in the official index fell for a second consecutive month (see figure), increased marginally.”
“We are reviewing our 7.0% forecast for 2Q15 growth for downward revision (Bloomberg consensus 7.0%). We reiterate our forecasts of more housing policy and monetary policy loosening, including a 25bp PBOC policy interest rate cut and a 50bp RRR cut per quarter in 2015, taking the 1-year lending rate to 4.60%, 1-year deposit rate to 1.75% and RRR to 17.5% by yearend (Bloomberg median forecasts 5.10%, 2.25% and 17.5% respectively).”