SHANGHAI Chinas economic growth showed some signs of slowing down in December, clouding the countrys steel market outlook somewhat even though the economic data remained in expansionary territory.
The HSBC manufacturing PMI for China registered a final reading of 50.5 points for December, unchanged from an earlier flash reading but down slightly from Novembers 50.8 points, according to data published Jan. 2.
The moderation of HSBCs PMI for December was mainly due to slower output growth. However, December marked the fifth month in a row that the banks PMI remained above 50, thanks to a steady increase in new orders, HSBC Bank (China) Co. Ltd. chief economist Qu Hongbin said.
"The recovering momentum since August is continuing into 2014. ... With inflation still benign, we expect the current monetary and fiscal policy to remain in place to support growth," Qu said.
Chinas official PMI for the manufacturing sector was 51 points in December vs. 51.4 points the previous month, according to National Bureau of Statistics (NBS) data released Jan. 1. This was the first time that the official manufacturing PMI saw a month-on-month decline since June 2013. However, the December figure also marked the 15th consecutive month above 50 points, a level that indicates growth, NBS said.
Meanwhile, the steel PMI for December was 47.7 points, down 1.3 points from November and the fourth straight month below 50 points, an indication that the industry remained under pressure, according to data released by the China Federation of Logistics & Purchasing (CFLP).
"The weaker economic data, along with the lower list prices, has dampened market sentiment and disappointed those who wished for a good start to the year," a Beijing-based analyst said.
A version of this article was first published by AMM sister publication Steel First.