China's PMI was 50.9% in June and the growing speed of economy slowed down

According to the report of China Federation of Logistics, the manufacturing PMI of China was 50.9% in June 2011 and the period-on-period growth fell down 1.1%. The manufacturing PMI remains above 50% reflecting that the current economy of China continues to grow, but the growing speed keeps falling down.After checking out the variety of indexes, we can see only the stock index of semi-finished products increased 1%, other indexes dropped to variety of degrees. The production index, new order index, backlog index, purchasing volume index, purchasing price index, raw materials inventory index all dropped more than 1%. The purchasing price index decreased the most, reached 3.6%.In the passed month, the PMIs of electrical machinery, equipment manufacturing, agro-food processing, food manufacturing industries all reached 50% or more. The PMIs of chemical product and chemical raw material manufacturing, textiles, transportation equipment industries were below 50%. The regional PMI in average: the East and West of China was above 50% in average, the middle region was below 50%. To the product types, consumer goods companies was higher than 50%, but the raw materials and energy, intermediate goods and finished goods companies was less than 50%.According to the manufacturing PMI data in June, we can figure out that the economic growth may continue to decrease in the future due to the durative reduction of PMI index. The reduction of PMI index was due to adjustments of inventory, the purchasing price index and raw materials inventory index decreased significantly which indicated that the inventory adjustment based on inflation expectation was in action, it will affect the economic growth. But the inventory adjustment is in short-term, so it will not affect the economy deeply and last for long time. We should note that the affection of investment, consumption and exports requirement would be bigger to the growth of economy. The demand growth is steady for now and the economic growth will not correct deeper.The import index and new export orders index also fell down in June. The import index was 48.7%, 1.8% lower than May. The import indexes of beverage, paper printing, sports products and communication equipments were higher than 50%. The import indexes of ferrous metal smelting, general equipment, chemical raw materials and chemical products industries were below 50%.The employing index fell to 50.2% in June, 0.7% less than that in May. The employing indexes of beverage, special equipment, ferrous metal smelting and processing industries were higher than 50%. The employing indexes of chemical raw materials and chemical products, non-ferrous metal smelting and processing industries were below 50%.PMI (Purchasing Managers Index) is an indicator of the economic health of the manufacturing industries. It is based on five major indicators: new orders, inventory levels, production, suppliers deliveries and the employment environment.Reported by Bean Taylor from iFreeTouch.com at 07/01/2011.