A key manufacturing index shows Chinese production in August plummeted to a nine-month low, reinforcing fears that the global economy is headed for a major slowdown.
The preliminary reading of HSBC’s survey of purchasing managers fell to 47.8 in August from 49.3 in July. The final report will be published Sept. 3.
Export business declined at the sharpest rate since March 2009, when the global financial crisis dried up European and U.S. demand for Chinese goods, according to an HSBC subindex. Export orders fell to 44.7 in August from 46.7 in July.
“To achieve the stated policy goal of stabilizing growth and the jobs market, Beijing must step up policy easing to lift infrastructure investment in the coming months,” said Hongbin Qu, chief China economist at HSBC.
The HSBC index results come after the Chinese government reported that industrial production growth in July fell to a three-year low.