China manufacturing PMI expected to return to expansion ahead of holiday

If the official manufacturing PMI returns above 50, that would be seen as a small boost for assets sensitive to China, such as the Australian dollar, the yuan and industrial metals. In the case of oil, the focus is on whether the figures alter expectations for Chinese fuel consumption; a weak non-manufacturing reading would sustain concerns about demand. Since mainland traders are on holiday from Thursday for a week, any unexpected number could be magnified in offshore markets. A downside surprise in the official data together with a softer RatingDog services reading would probably make traders wary heading into the break.

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China's September PMI figures are all released in one session just ahead of the holiday; the official manufacturing gauge is expected to nudge back above 50 while the private-sector services reading is seen easing a bit.

• Both the official NBS and the private RatingDog PMIs for China are released on September 30, ahead of the week-long holiday that begins on October 1.
• The NBS data is scheduled for 01:30 GMT (21:30 US Eastern on September 29) and the RatingDog data for 01:45 GMT (21:45 US Eastern).
• The NBS manufacturing PMI is seen at 50.1, compared with 49.8 previously, taking it back above the 50 level that separates growth from contraction.
• The NBS non-manufacturing gauge is projected at 49.3 versus 49.0, remaining below the 50 threshold.
• RatingDog's manufacturing index is expected at 51.6 against a prior 51.5, while its services measure is seen at 51.1 versus 51.4.

China's September purchasing managers' indexes are released on Wednesday, September 30, with both the government and private surveys coming out in one session because the country enters a week-long holiday on Thursday, October 1. The NBS manufacturing and non-manufacturing data are due at 01:30 GMT, equivalent to 21:30 US Eastern on September 29. The RatingDog China numbers follow at 01:45 GMT, or 21:45 US Eastern. Composite readings for each series are also published.

The official manufacturing measure is forecast to edge up to 50.1 from 49.8, a modest improvement. That would bring the index above the 50 threshold indicating growth. The NBS non-manufacturing PMI is projected at 49.3, higher than the prior 49.0 but still in contraction territory, even though the trend is upward.

The RatingDog readings are anticipated to present a more stable but somewhat varied picture. Manufacturing is seen at 51.6 versus a previous 51.5, staying well within expansion. Services is expected at 51.1, a slight dip from 51.4, but still above the 50 level despite the modest easing.

The previous month's data highlights a distinct difference between the two survey sets. In August, the official indices were below 50 for both manufacturing and non-manufacturing, whereas both RatingDog measures were above 51. That divergence stems from the fact that the surveys are conducted independently. Market participants will be observing if the current figures reduce that gap or keep it unchanged.

The timing increases the significance of the release. Since the figures come out right before the holiday, they provide the final comprehensive snapshot of Chinese economic activity before the break. Markets that are sensitive to China, like the yuan, the Australian dollar and industrial commodities including oil, will be paying close attention. A manufacturing figure returning above 50 would bolster the argument for stabilisation, whereas a disappointment in the official data would confirm the weaker trend seen previously.