Metallurgy pulls the Chinese economy to the bottom

Economic growth in China slowed down in December 2013 due to the foggy prospects of heavy industry, including ferrous metallurgy. Despite the fact that the KKNR indicators are in a positive trend, investors are afraid of deterioration of conditions in the near future.

The general consumer PMI index in December was at 50.5, decreasing by 0.3 points from 50.8 in November 2013. Especially strong pressure was exerted by the fall of the PMI in the metallurgical industry - up to 47.7, which is 1.3 points worse than the November indicator. In addition, consumption in metallurgy has been falling for the fourth month in a row, as evidenced by the PMI value below 50 points.

“The weaker econsmic data, along with falling prices, have already had a negative impact on market moods and disappointed those who expected a good beginning of 2014,” Beijing metal traders say.

Meanwhile, in the manufacturing industry, the official PMI compiled in December 51 points after 51.4 points in the previous month. This was the first decrease in business activity in this industry sector since June 2013. Nevertheless, the PMI in the processing sector is kept at a level above 50 points for 15 months in a row.