Chinese companies are facing a sharp slowdown in new order growth just as the burden of fast-rising input prices appears to be lifting, the results of the latest Xinhua Finance/MNI China Business Sentiment Survey indicate.

The headline sentiment index for current business conditions in September rose slightly to 58.24 from August's 56.46, which was the second lowest reading since the survey began in January, 2005. The index was at 67.31 in September last year.

Other indexes show a quickly shifting playing field for Chinese businesses: new order growth, which has remained fairly strong in recent month despite problems elsewhere, saw a sharp decline in September; the rise in input costs, which has stayed high for the last year or so, appears to have sharply tapered off. So has the increase in prices companies are able to charge, however.
Despite the slowing pace of the input cost rise, companies overall are reporting a decline in the improvement of their overall financial positions.