🇨🇳RPT-Cable FX Macro Weekly Note: China May NBS PMIs

**As seen in Risk In The Week report 05/27/23, subscribe at cablefxm.co.uk/reports

*CHINA MAY MANUFACTURING PMI 48.8; EST. 49.5

April Chinese manufacturing index slipped into a contractionary reading at 49.2 vs the prior 51.9, the figure missed expectations of a 51.4. The non-manufacturing metric came in at 56.4, this was below market expectations for a 57.0, the composite printed at 54.4. In the manufacturing release, employment declined for a second straight month to 48.8, new export orders fell below 50.0 at 47.6. The private PMI release followed the NBS numbers, a sharp decline in factory activity was recorded here, these data goes to show a broad softness in demand. However, the services index is outpacing the manufacturing sector, this mirrors a pattern seen in other developed economies. This does not mean that the manufacturing slowdown is not a somewhat surprising occurrence, given the green shoot expectations on the China reopening. The desk at J.P. Morgan hinted at both Caixin and NBS manufacturing PMIs showing a decline of momentum in the sector. J.P. Morgan expects the recovery in the services sector to be carried well into Q2, they see the reading staying in expansionary levels.