Monday, April 22, 2013

Uh-Oh China’s PMI Miss Means Trouble With a Capital T

China's first economic indicator for the second quarter far underperformed expectations on Tuesday, putting the nation's recovery in question as economists recalibrate growth projections lower for the world's second largest economy.

China's flash HSBC PMI fell to a two-month low of 50.5 in April from 51.6 in March – compared with expectations for a fall to 51.5. A reading above 50 indicates expanding activity and one below 50 signals contraction.

"It's a big miss. Confidence in the outlook for China has really diminished, particularly after first quarter growth data," said Tim Condon, head of research for Asia at ING. "People are now reforming their views on economy. The new view is that growth will be stagnant," he told CNBC.

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