2023-09-30 19:22:55
China’s industrial activity returned to expansion for the first time in six months, adding to signs that some parts of the economy are regaining balance.
The official industrial purchasing managers’ index rose to 50.2 this month from 49.7 in August, the National Bureau of Statistics said on Saturday, beating economists’ expectations and rising above the 50 level that separates expansion from contraction. .
An indicator of non-industrial activity – which covers the services and construction sectors – rose to 51.7, compared to 51 in August, also above the median forecast in a Bloomberg survey.
Investors and analysts have been looking for evidence that China’s recent stimulus measures are bolstering an economic recovery that has been challenged this year by weak consumer and business confidence and the ongoing housing crisis. Along with a more flexible monetary policy, the country has also seen an increase in local government borrowing for infrastructure as authorities look for ways to support growth.
“The PMI reading reinforces our view that the economy is beginning to stabilize,” Raymond Yeung, chief economist for Greater China at Australia & New Zealand Banking Group Ltd., said in an email. “One positive is the strong input price reading, suggesting that deflationary pressure has been at least somewhat eased.”
Recent indicators suggested an exit from the worst of the slowdown. Industrial profits increased in August for the first time in more than a year, while the drop in exports slowed and credit grew more than expected.
Even so, the outlook for the economy remains uncertain. Economists cut their forecasts for gross domestic product expansion in the latest Bloomberg survey, now seeing the country almost reaching its growth target of around 5% for the year.
President Xi Jinping promised on Thursday to intensify efforts to meet the country’s annual economic and social development goals, in a speech marking the 74th anniversary of the founding of the People’s Republic of China. He promised to tighten macroeconomic controls and expand domestic demand in his drive for “continuous improvement” of the economy, without announcing any specific measures.
#China #manufacturing #activity #expanding #time #months