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China’s Weakest PMI Since 2016

PMI numbers out of China

World Market News : Economic data scheduled for release this morning was limited. November private sector credit figures out of Australia. December private sector PMI numbers out of China.

With the year coming to an end, a number of key markets are closed through today. Including Japan, Italy and Germany. With the remainder on a shortened session to pin back volumes through the day ahead of tomorrow’s market close.

For the Aussie Dollar, private sector credit rose by 0.3% month-on-month, in November. Which was in line with forecasts, whilst easing from a 0.4% rise in October, according to figures released by the RBA.

  • Personal credit continued to drag in the month, falling by 0.3% following October’s 0.3% decline.
  • Housing credit and business credit saw the same pace of growth, rising by 0.3% and by 0.5% respectively.

The Aussie Dollar moved from $0.74096 to $0.70525 upon release of the data. Which preceded the PMI numbers out of China.

Out of China, it was a mixed bag, with the manufacturing PMI falling from 50.0 to 49.4 in December. Reflecting a contraction in the sector after stagnating in November. Service sector activity picked up however. With the PMI rising from 53.4 to 53.8, coming in ahead of a forecasted 53.2.

  • Large companies and state owned enterprises (SOEs). Within the manufacturing sector contracted for the first time since 2016 and was the weakest since February 2016.
  • New export orders contracted for a 7thconsecutive month.
  • Support came from the non-manufacturing sector numbers. With the Chinese government having been looking to re balance the economy skewed in favour of non-manufacturing.

The Aussie Dollar moved from $0.70536 to $0.70464 upon release of the figures. Before rising to $0.7059 at the time of writing, up 0.17% for the session. Supported by positive updates over initial talks between Trump and Chinese Premier Xi.

Elsewhere, the Japanese Yen stood at ¥110.45 against the U.S Dollar, down 0.16% for the morning. For the Kiwi Dollar, things were less rosy, down 0.01% to $0.6717.

In the equity markets, positive updates from Trump on trade talks provided support to the Hang Seng. Which was up 1.18% at the time of writing. While the ASX200 gave up gains from earlier in the session, down 0.06%. With the reversal coming in spite of bounce in the U.S futures market, the Dow Mini up by 146 points.

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About Dwipen Gogoi

Dwipen Gogoi, MBA (IB and IT) and PGDFT from Pune. (Technical Analyst of AliceBlue) I am a You Tuber, Blogger and doing Technical Analysis last 10 years in Stock, Commodity and Forex Market. i am creating various trading strategies for day traders, swing traders, scalp traders.

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