Private business activity in Hong Kong slowed in June as the pace of new orders eased, notably from mainland China, a purchasing managers' index showed on Monday. The private sector did however still mark an 18th straight month of expansion and companies actually stepped up hiring to cope with growth in business and backlogs of orders.
The Brunswick Purchasing Managers' Index (PMI) fell for a second consecutive month to a seasonally adjusted 53.3 in June from 53.9 in May.
The index is now at its lowest level since December, although it is still above 50, indicating activity in the private sector continues to expand.
"Despite a slowdown in the level of new orders, Hong Kong's economy recorded solid growth during June," said Ray Bashford, a partner at Brunswick Hong Kong, a public relations firm. "The fact that employment levels rose again is a clear indication that employers are continuing to invest to meet future demand."
Employment was at its strongest since March but wage inflation was slower than in previous months, the survey showed.
Companies continued to be hit by rising raw material prices but managed partly to offset that by charging higher prices for their products. Their pricing power was not as strong as in May but was better than earlier in the year, according to the survey.
The PMI survey compares business conditions with a month earlier based on data from 300 private Hong Kong companies in manufacturing, services, retail and construction. The data is collected by NTC Research.