China’s Caixin Manufacturing PMI Flash SEP, will likely going down and very likely going down more than forecasted, due to the following reasons:
1. almost 180 Billion USD wealth outflow in Aug. and like similar size of outflow in Sep.
2. 3 policies in restricting capital outflow in the last 2 weeks might indicate significant pressure felt in banks, our source visited banks in China and the implementation is in fact more harsh than public information for Chinese as well as foreign citizen. and those policies might cause panic rush to USD in Sep. especially if there are news of large selling of US bonds by Chinese government.
3. 180 billion USD outflow in Aug might indicate strong tendency of business owners to pull both liquid and non-liquid asset out of China. if so could carry over the trend to Sep and pressure the real economy. and these vicious cycle might continue….
We feel the risk to down side and we feel there is limited capacity that China can restart large scale stimulation due to big pressure of RMB depreciation and capital outflow . for details please refer past article: “The State of the Market, Sentiment and Long Term Positioning”
6:40 AM, Sep 22, 2015