China Flash PMI at weakest level since 2008 financial crisis

HONG KONG - The Caixin China Manufacturing PMI has fallen to 47.1 in the flash reading for August - the weakest reading since the 2008 financial crisis. Domestic and external demand weakened simultaneously, which weighed on production and pushed up inventories. Labour demand also fell to the worst level since January 2009.

HSBC says the economic recovery continued to lose momentum in August after a series of poor activity data in July. “Further policy easing measures from monetary easing to fiscal support are needed,” HSBC says. “We forecast another 25bps policy rate cut and 100bps reserve ratio cut in Q3, possibly in coming weeks.”  www.hsbc.com (ATI).