Hong Kong’s business sentiment continued to be under pressure, and the Hong Kong PMI fell to a low of nearly three years! The Nikkei and IHS Markit jointly announced that after the seasonal adjustment, the Nikkei Hong Kong Purchasing Managers Index fell to 46.9 in April from 48.4 in April, the lowest level since June 2016. Just as some companies say that US-China trade friction has dragged down customer demand, the latest PMI figures show that the private economy has experienced a sharp decline. The PMI Headline Index is a comprehensive indicator of the performance of the private sector.
The customer demand in May was further weakened, and the overall decline in new orders was faster than in April. As the volume of orders sold to China decreased again, the decline in new business was close to the largest in three years. New business volume from China has fallen for 13 consecutive months in May.
Bernard Aw, chief economist at IHS Markit, commented on the results of the Hong Kong PMI survey, saying that the latest Nikkei PMI survey showed that the prospects for the private economy in Hong Kong were heavier in the middle of the second quarter. The PMI headline index in May was close to a three-year low, indicating that business conditions have clearly weakened. The most concern is that the number of new orders received by enterprises has fallen sharply due to the decrease in domestic demand. Given that China is Hong Kong’s largest export destination and accounts for more than 50% of Hong Kong’s total exports, the tension between the US and China trade has reheated, which is clearly detrimental to Hong Kong’s economic development.
He continued, PMI’s survey data generally revealed that the stalemate in the trade has weakened the market demand for goods and services in Hong Kong, leading to pessimistic expectations for output in the next year. The results of the PMI survey in May roughly showed that the annual economic growth was less than 1.5%.