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China Manufacturing Contracts In June According To The PMI

Source: http://chinaeconomywatch.blogspot.com/2008/08/china-manufacturing-contracts-in-june.html
Posted on Friday, August 1st, 2008 | In China
Contributed by: Edward Hugh (http://globaleconomydoesmatter.blogspot.com) -

Manufacturing in China contracted – on a seasonally adjusted basis – for the first time in many years in July as export demand faltered and factories closed to clear the air before the Olympic Games. The Manufacturing Purchasing Managers’ Index – prepared by the China Federation of Logistics and Purchasing – fell to a seasonally adjusted 48.4 in July from 52 in June. Any reading below 50 represents contratction, and this was the first such reading since the survey began in 2005.

The output index fell to 47.4 in July from 54.2 in June, while the index of new orders dropped to 46.2 from 52.6. The index of export orders declined to 46.7 from 50.2.

None of this is really too surprising, as it is hard to see how you can maintain 20% plus export growth as all your main customers’ economies are slowing. The expansion in what is now the world’s fourth-biggest economy slowed for the fourth straight quarter in the three months through June, according to initial estimates.

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About Edward Hugh (http://globaleconomydoesmatter.blogspot.com)
Edward Hugh is a macro economist, who specializes in growth and productivity theory, demographic processes and their impact on macro performance, and the underlying dynamics of migration flows.

Hugh is a founding member and regular contributor to a number of economics weblogs, including Global Economy Matters, Demography Matters and a number of others.

Edward 'the bonobo' Hugh is a Catalan economist of British extraction based in Barcelona. By inclination he is a macro economist, but his obsession with trying to understand the economic impact of demographic changes has often taken him far from home, off and away from the more tranquil and placid pastures of the dismal science, into the bracken and thicket of demography, anthropology, biology, sociology and systems theory. All of which has lead him to ask himself whether Thomas Wolfe was not in fact right when he asserted that the fact of the matter is "you can never go home again". He is currently working on a book with the provisional working title "Population, the Ultimate Non-renewable Resource".

Edward also writes regularly for the demography blog Demography Matters. He also contributes to the Indian Economy blog . His personal weblog is Bonobo Land . Edward's website can be found at EdwardHugh.net.

Edward follows in detail the Indian, Italian, Spanish, German and Japanese economies. He also has a more than a passing interest in the economies of Turkey and Brazil and in the emerging economies of Eastern Europe.

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