The Caixin Manufacturing Purchasing Managers’ Index (PMI) serves as an economic indicator that sheds light on China's manufacturing sector. This index assesses the health of the manufacturing industry through a survey conducted among purchasing managers from small and medium-sized enterprises (SMEs).

What is Caixin Manufacturing PMI? The Caixin Manufacturing PMI is a monthly survey targeting purchasing managers within China's manufacturing sector. It evaluates the level of activity in this sector and acts as a leading indicator of economic growth in China. The survey collects feedback from purchasing managers in small and medium-sized manufacturing firms, focusing on their views regarding the sector's performance in areas such as production, new orders, employment, inventories, and suppliers’ delivery times. This indicator is crucial for investors and businesses, as it offers insights into the health of the Chinese economy and its potential for future growth. Additionally, the PMI is utilized to assess the effectiveness of government policies aimed at stimulating economic growth.

How to Read the Caixin Manufacturing PMI: The index is computed using a weighted average of five sub-indices, with the following weights: New orders (30%), Output (25%), Employment (20%), Suppliers’ delivery times (15%), and Stock of items purchased (10%). A PMI reading above 50 indicates expansion in the manufacturing sector, while a reading below 50 signifies contraction. A reading at 50 suggests no change in the sector’s performance.

When interpreting the Caixin Manufacturing PMI report, consider the following factors: Index value—determine whether the index is above, below, or at the 50-mark threshold to assess if the manufacturing sector is expanding, contracting, or remaining stable; Trend direction—compare the current month’s PMI value with previous months to identify trends, such as sustained growth or contraction in the sector; Sub-indices—analyze the performance of the five sub-indices for insights into specific areas of the manufacturing sector, such as new orders, output, and employment; Comparison with other indicators—examine the Caixin Manufacturing PMI alongside other relevant economic indicators, like GDP growth and industrial production, for a comprehensive understanding of China’s economic health.

Why is Caixin Manufacturing PMI important? The Caixin Manufacturing PMI holds significance for several reasons: Timeliness—being a monthly indicator, it provides a timely snapshot of China’s manufacturing sector, enabling investors, policymakers, and analysts to closely monitor economic trends; Representativeness—by focusing on small and medium-sized enterprises, the Caixin PMI complements the official Chinese Manufacturing PMI, which mainly covers large enterprises; Global impact—given that China is the world’s second-largest economy, its manufacturing performance can affect global trade, commodity prices, and financial markets. The Caixin PMI is a valuable resource for international investors and policymakers assessing the health of the Chinese economy.

Who publishes Caixin Manufacturing PMI? The Caixin Manufacturing PMI is compiled by IHS Markit, a leading global provider of information, analytics, and solutions, in collaboration with Caixin Media, a prominent Chinese financial media group. The data is derived from a survey of purchasing managers from small and medium-sized manufacturing companies throughout China.

When is Caixin Manufacturing PMI released? The Caixin Manufacturing PMI report is generally released on the first business day of each month, providing data for the preceding month. The report can be accessed through Caixin Media’s website and various financial news outlets. Furthermore, IHS Markit offers subscription-based access to detailed PMI data and analysis, catering to a diverse range of professional users, including investors, economists, and researchers.