The official Non-Manufacturing PMI and Manufacturing Purchasing Managers PMI were released as follows:
- China’s official services PMI in October fell to 48.7 from 50.6 in September.
- China October official composite PMI 49.0.
- China’s official October manufacturing PMI at 49.2 (Reuters poll 50.0) vs. 50.1 in September.
The price was stationary on domestic retail sales in line with expectations. However, there was a move at the turn of the hour that took the price to a new session high, well and truly closing the opening gap before the Chinese data was released at 0.6418.
However, we saw a sharp decline in the data and it should also be noted that the Hang Seng China index is heading towards its lowest since 2005.
AUD/USD is under pressure in the red at 0.6405 with daily lows in sight:
Why data matters to traders
The monthly manufacturing PMI is released by the China Federation of Logistics and Purchasing (CFLP) on the last day of every month. The official PMI is released ahead of the Caixin Manufacturing PMI, making it even more of a leading indicator, underscoring the health of the manufacturing sector, considered the backbone of China’s economy. The data is of great relevance to financial markets across multiple asset classes, given China’s influence on the global economy.
The China Federation of Logistics and Purchasing (CFLP) releases the non-manufacturing PMI monthly. The gauge highlights the performance of China’s service sector, which has a significant impact on the global forex market, given the size of China’s economy. An expansion of Chinese service sector activity indicates signs of economic improvement and vice versa.