The latest PMI (Purchasing Managers Index) figures suggest the "screws are coming loose" in emerging Asia, with new export orders contracting at their fastest since March 2009, says HSBC.
HSBC co-head of Asian economics research Frédéric Neumann said that with the exception of Japan, India and Australia, manufacturing PMIs remain in “contractionary territory”.
Moreover, Mr Neumann said that exports throughout Asia are continuing to struggle, with the China Caixin PMI index continuing to contract for the the third month running.
“Our second heatmap shows that new export orders have fallen at a sharper pace in September (with the exception of Malaysia, where the tumbling currency might have helped at the margin),” Mr Neumann said.
“This is also starting to affect developed markets ... raising the spectre that weakness in Asia may feed back to the west, curtailing growth across the world (new export orders globally continue to shrink).”
According to Mr Neumann, growth in emerging Asia is unlikely to resume without an improvement in exports.
“Given that the latter remain under pressure, it is not too surprising that employers are cutting jobs. This isn’t exactly a sign that consumer spending will accelerate any time soon,” he said.
"The engine needs an overhaul. And that'll take time. Asia will be stuck in the slow lane for a while."
Meanwhile, large Chinese enterprises are set to benefit from additional government stimulus, while small and medium-size businesses are likely to remain stagnant, according to Warwick Business School.
Warwick Business School's professor of strategic management, Kamel Mellahi, said further policy easing likely to be introduced before the end of the year will shore up Chinese economic growth.
“The official manufacturing purchasing managers' index tracks large state-owned enterprises which are benefiting from a significant government stimulus and investment in infrastructure, while [China's] Caixin tracks small and medium-sized enterprises' activities, which are struggling,” Mr Mellahi said.
“The situation for small and medium-sized enterprises is not set to change any time soon as demand is unlikely to pick up to a level that will absorb the current vast oversupply in manufacturing.”
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