China's PMI to deliver more constructive tone

China's HSBC manufacturing PMI flash estimate rose modestly to 49.6 in June from 49.2 in May. Improvements in production and external demand were the main drivers. Nevertheless, convincing signs of improvements in domestic demand were still missing in this June report.

Societe Generale says, insufficient funding growth remains the main cause of the very slow recovery, therefore, the bank expects the official PMI to rise slightly to 50.3 in June from 50.2 in May, mainly reflecting the rebound in external demand.