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MTECHTIPS:-NYMEX crude falls after China PMIs, Brent down as well
Crude oil prices held weaker in Asia on Monday on dimmed hopes for demand-led growth as China showed manufacturing remains in contraction. On the New York Mercantile Exchange, crude oil for delivery in March dropped 1.34% to $33.13 a barrel. Brent fell 1.65% to $35.38 a barrel. In China the semi-official manufacturing PMI for January reached 49.4, missing the 49.6 level seen and remaining in contraction and the Caixin Manufacturing PMI index came in at 48.4, a bit above the expected 48.0. As well, Japan reported its manufacturing PMI came in at 52.3, compared to a 52.4 level seen. The non-manufacturing PMI in China hit 53.5, down from 54.4 the previous month. Figures above 50 suggest expansion and those below contraction. “The upshot is that economic momentum may have deteriorated last month. That said, we can’t be certain yet,” Capital Economics said in a note to clients after the data. “The PMIs provide and early hint of how the economy is performing but we don’t recommend putting too much weight on them. The official manufacturing PMI, in particular, appears to have been a poor gauge of economic activity over the past year.” Earlier, the AIG Manufacturing index in Australia for January came in at 51.5 with last month’s reading at 51.9. As well, the MI Inflation Gauge is due for a month-on-month estimate. In the week ahead, investors will be awaiting a flurry of survey data on manufacturing and service sector growth amid concerns over the outlook for the global economy.
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