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23 April 2013 By John Foley Follow @johnsfoley

Disappointing PMI data suggests trouble for exporters, confirming recent warning signs from banks that lend to them. If lay-offs remain moderate, the adjustment may be healthy for the economy. For lenders, though, slower trade could create a further rise in non-performing loans.

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A key Chinese manufacturing reading came in at a two-month low on April 23, showing deteriorating conditions for exporters and missing consensus expectations. The HSBC Flash Manufacturing PMI was 50.5 for April, compared with a final 51.6 percent in March, where a result above 50 indicates a positive change in conditions.
Employment conditions and export orders both worsened, according to the survey sent to over 420 manufacturing companies, while output and new orders improved at a slower rate than the previous month. Earlier data showed exports for March grew 10 percent year on year, compared with growth in January and February of over 20 percent.
[The second paragraph of this view was corrected on April 23 to state that 7.7 pct is the GDP growth figure reported for Q1 2013, not March 2013.]

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