Modestly higher than the 'contractionary' 49.7 print in Janauary, February's Markit (flash) China Manufacturing PMI printed at 50.1 (beating expectations of a drop to 49.5). However, before global investors pop the proverbial champagne corks of global recovery, we note that employment's drop accelerated, New Export Orders contracted the most since June 2013, and prices continued to fall. Of course, HSBC is careful to note that "more policy easing is still warranted" because they believe, "domestic economic activity is likely to remain sluggish and external demand looks uncertain." For now Chinese stocks are holding losses after the lunar new year and the Yuan has weakened further near 30 month lows - once again testing the upper 2% fix band.
A middle of the road 50.1...
[6]
And the breakdown does not encourage too much...
[7]
With the biggest contraction in export orders in almost 2 years and continued weakness in employment...
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And the Yuan is weakening further...
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Charts: Bloomberg
