China’s Non-Manufacturing & Manufacturing PMIs Show to What Unfathomable Extent the Economy Has Collapsed | Wolf Street
Purchasing Managers’ Indices (PMIs) are a tally of how executives see their own company – whether business activity at their company rose or fell compared to the prior month, whether new orders rose or fell, whether they added or shed staff, etc. Executives and their companies remain unnamed. A value above 50 means expansion; a value below 50 means contraction. PMIs are an early indication of business conditions – and by extension, of the economy.
And in China, both, the PMI for the non-manufacturing sector and the PMI for the manufacturing sector, released on March 1, have collapsed to unfathomable lows, showing to what extent the measures to impede the spread of the coronavirus have shut down the economy.
Even non-manufacturing activity collapses.
The official Non-Manufacturing PMI, released by the National Bureau of Statistics, collapsed from 54.1 in January (still well into expansion mode) to a previously unthinkable low of 29.6 in February.