Hong Kong Private Sector Activity Improves In July



Hong Kong's private sector activity expandedin July as output improved, results of a survey by Markit Economics and HSBC Bank showed Tuesday. The HSBC purchasing managers' index, or PMI, for the private sector, rose marginally to 50.4 in July from 50.1 in June. This marked the highest reading in five months and signaled continued expansion in activity. A reading above 50 indicates expansion in private sector activity. Private sector output grew for the first time in five months, though at a slow pace, in July. Client demand improved in July as demand from Mainland China increased. However, new orders declined for the third consecutive month, though at a marginal rate. Job shedding decreased to the slowest rate in four months in July. Input costs increased further but at the second-weakest rate in eleven months. Output prices increased marginally and the rate of increase was the joint-slowest since the start of the current sequence of inflation began in May 2013. "Hong Kong's economy is stabilising, although it is still not yet back to normal as the PMI for July only showed a marginal return to overall growth and new orders remained in contraction. Still, there was an encouraging rebound in new business from China, which could potentially be sustained given the improving economic data from the Mainland of late," said John Zhu, HSBC economist.


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