The official manufacturing PMI came in at 50.2 for May, up very modestly from April's number of 50.1. Although a slight improvement on the month, as seen on the chart below it is not clear that we are seeing a significant pickup in activity. New orders PMI (50.6) does not show a clear pickup in activity either, although it has modestly improved as well. The numbers are a bit better than last month, but the dial has barely moved. It will still be a couple of months until the PBOC stimulus drives activity meaningfully higher. See my post "Things will get worse before they get better." for details. Employment PMI came in at 48 - below 50 - and probably no comfort to Beijing policymakers who ultimately want to keep employment stable.
The worrying number is the non-manufactuing PMI. At 53.2, non-many PMI is still above 50 and showing expansion. But, the direction and the speed of the slowing number needs monitoring. The service sector has been keeping GDP on target as the industrial sector slows below 7%. If non-manu PMI goes below 50, then GDP growth will have a hard time staying above 7% this year.
Here are all PMI component charts: