In January this year, the China HSBC Flash Manufacturing Purchasing Managers Index (PMI) increased to 49.8, up from December's final reading of 49.6, as announced by the HSBC on January 23.
Hongbin Qu, the HSBC's chief economist for China, said that the new order index indicates a rebound, while price and employment indexes have continued to decrease. THE PMI data showed that demand in the manufacturing industry has seen a slight improvement, while not enough to affect inventory and employment. At the same time, new export orders continue to indicate increases, reflecting the recovery of external demand. However, with the flash PMI still below the threshold of 50, the HSBC official suggested that China should ease its monetary and fiscal policy to stimulate economic development.