China's manufacturing PMI in November was 51.8, the highest since 2017

On December 2, the Manufacturing Purchasing Managers Index (PMI) of Caixin China in November was 51.8, up 0.1 percentage point from October, rising for five consecutive months, the highest since 2017.

This trend is consistent with the manufacturing PMI of the National Bureau of statistics. The PMI of manufacturing industry in November reported by the National Bureau of statistics was 50.2, up 0.9 percentage points from the previous month, only lower than that in March, the second highest in the year.

The index of new orders in November fell slightly from last month's high, but remained at a high level. The index of new export orders also declined slightly, but it is still above the boundary between boom and bust, and it is in the expansion range for the first two consecutive months since March 2018. Many manufacturers report that the demand fundamentals have become stronger and overseas demand has also improved. According to the classification data, the orders of the three product categories have generally increased.

Demand improved, leading manufacturers to expand production, and manufacturing output further increased, but the output index slightly fell from a high level.

After seven consecutive months of contraction in the employment scale, the number of manufacturing employees in China basically stabilized in November, and the employment index rebounded significantly from the low level of last month, leaping above the boundary between boom and bust, which is the second employment expansion since March this year.

The increase of output drives manufacturers to increase purchasing, and the purchasing inventory index is in the expansion range for three consecutive months; as manufacturers use inventory to deliver new and old orders, the finished product inventory index is in the contraction range for two consecutive months, but the decrease is only slight.

In November, the average input cost increased slightly, but the increase was the lowest in three months, far below the long-term average. Manufacturers generally say that the rising cost is related to the rising price of raw materials. The ex factory price index picked up slightly, but has been in a contraction range for five consecutive months. According to the respondents, the market price is generally down, which limits the pricing power of the manufacturers.