PREVIEW-China PMI set to ease again as growth fears nag

* WHAT: China’s official Purchasing Managers’ Index for July

* WHEN: Sunday, Aug 1, around 0100 GMT

REUTERS FORECAST:

Median: 51.1, which would be lowest since February 2009

Range: 50.0 to 51.7 (11 forecasts)

Previous: 52.1 in June, 53.9 in May and 55.7 in April

FACTORS TO WATCH: China’s official PMI is likely to have
eased to a 17-month low in July as policies to curb lending and
rein in the property market weigh on manufacturing.

Economists will be paying particular attention to the new
orders and stocks of finished goods sub-indexes. The former
slumped in July, while the latter rose, suggesting big
inventory accumulation and possibly future cuts in factory
production.

MARKET IMPACT: The PMI is expected to remain above the 50
threshold demarcating expansion and contraction. But inadequate
seasonal adjustment of the index means a drop below the
boom-bust line is not out of the question. That would rock
markets, given that China could account for a third of global
growth this year.

Breakdown of forecasts

Fortune Trust Co 51.7

China Economic and Business Monitor 51.5

Guotai Junan Securities 51.5

Barclays Capital 51.2

Royal Bank of Scotland 51.2

China Merchants Bank 51.1

Industrial Bank 51.1

Bank of America Merrill Lynch 51.0

Bank of China 50.5

Hongyuan Securities 50.2

Industrial Securities 50.0

——————————————

Median 51.1

Previous Month 52.1

Year earlier 53.3

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(For more stories on China’s economy (Read more about the fastest growing economy.), click on [CN-MCE-M])
(Reporting by Beijing newsroom; Writing by Alan Wheatley;
Editing by Ken Wills)

PREVIEW-China PMI set to ease again as growth fears nag