Workers busy themselves in an electronics plant in China in this undated file photo. A monthly monitor says the country’s Purchasing Managers’ Index, a key manufacturing indicator, has fallen to 47.0, which is the lowest since March 2009. AP FILE
BEIJING, China — A key measure of manufacturing in the world’s second largest economy fell to a new six-and-a-half-year low in September, financial publisher Caixin said Wednesday.
The preliminary figure for its Purchasing Managers’ Index (PMI) came in at 47.0, down from August and missing expectations.
The PMI survey is closely watched by investors around the world for clues on the health of the Chinese economy, a crucial driver of global growth, as it is the first regular statistic to be announced for each month.
International stock exchanges have been rocked in recent weeks by concerns about the Chinese economy, which is both a huge buyer of commodities and a vital market in itself, and is also buffeted by global trends.
A PMI result below 50 indicates the manufacturing sector is contracting, while anything above shows expansion.
The figure for September was the worst since 44.8 in March 2009, and fell from a final figure of 47.3 in August. It was also below the median forecast of 47.5 in a poll by Bloomberg News.
“The decline indicates the nation’s manufacturing industry has reached a crucial stage in the structural transformation process,” He Fan, chief economist at Caixin Insight Group said in a statement accompanying the figures.
He blamed the weakness mainly on sluggish external demand for Chinese goods and lower export prices.
“Patience may be needed for policies designed to promote stabilization to demonstrate their effectiveness.”