(Reuters) – Chinese factories battled with their weakest activity in 32 months in November, a preliminary purchasing managers’ survey showed, reviving worries that China may be skidding toward an economic hard landing and compounding global recession fears.
The HSBC flash manufacturing purchasing managers’ index (PMI), the earliest indicator of China’s industrial activity, slumped in November to 48, a low not seen since March 2009.
The data showed the world’s growth engine is not immune to economic troubles abroad, and could further unnerve financial markets already roiled by Europe’s deteriorating debt crisis.
November’s flash reading is a sharp three-point fall from October’s final figure of 51 and indicated Chinese factory output shrank on the month in November. A PMI reading of 50 demarcates expansion from contraction.
The last time the PMI slipped below 50 was in September, when the index hit 49.9.
“Industrial production growth is likely to slow further to 11-12 percent year-on-year in coming months as domestic demand cools and external demand is set to weaken,” said Qu Hongbin, a HSBC economist.
In line with the dismal headline number, the flash output sub-index tumbled to a 32-month low of 46.7, a steep drop from October’s final reading of 51.4.
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Oh shit this is of course BULLISH since now that Chinese manufacturing is slipping it can come back online. Why isn’t oil pricing that in, huh!?
Crude to $120!
if only a nuke plant would explode tonight and a earthquake destroy all the ghost cities.
Then they could rebuild them! Oh crude would go to $200 for sure then!! (swoon)