The following is an extract from IHS Markit's monthly Asia PMI overview presentation.
The Asian economy expanded at a modest pace in September, according to PMI data. At 51.5, the Asia Composite PMI Output Index was close to the 51.8 reading seen in August. However, the latest figure rounded off the weakest quarter for a year, with historical comparisons indicating an annual GDP growth rate of just below 5.0% for the third quarter.
Asia’s economic growth has seen some loss of momentum in recent months, as a slowdown in the manufacturing sector in the second quarter was followed by an easing in services activity growth at the start of Q3. This contrasted with a solid end to 2016, when the economy was lifted by rising business activity across both manufacturing and service sectors.
Asia PMI and economic growth
The latest headline Asia Manufacturing PMI was close to August’s five-month high but continued to underperform global manufacturing trends, reflecting the uneven performance across the region. Of the 12 economies monitored, only half showed improved manufacturing conditions during the third quarter.
In September, Taiwan led the PMI rankings across the region for a third month running, followed by Vietnam and Japan. Outside the top three, the rest recorded either moderate expansions or declines. Notably, the Philippines saw another weak performance, contrasting with strong growth seen in 2016 and during the first half of 2017.
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