Purchasing Managers Indexes have been all the rage for years, but many in the know look up the chain to the SALES Managers for a better idea of what’s happening in real-time and soon-to-come to the other indexes. Such is the case with China’s SMI, or Sales Managers’ Index.
China’s SMI has fallen to an all-time low and appears to be contracting rapidly as the coronavirus impact on the China economy is profound. Drops seen like this in other nation’s PMIs are often commensurate with GDP declines in double digits for the month. Considering January was already weak from the ongoing impacts of the Trump Slump, and March is unlikely to roar in like a lion, the Q1 2020 in China may be deeply in contraction.
As the world’s second largest economy, this does not bode well for the rest of the world economy. The global economic slump of 2018-2019 appears to be morphing into something far worse with the economic impact of the deadly coronavirus outbreak.
- All Sales Managers’ Indexes fall to all time low levels
- All Indexes fall to below the 50 “no growth” level
- 55.4% of companies in the panel claim they have been affected by Coronavirus
- Services companies affected to a similar extent to manufacturing
- The impact on economic activity has clearly been profound
- GDP must have fallen significantly in February