Beijing, Sep 1 (efe-epa).- China’s industrial activity grew in August at the fastest pace in nearly a decade, according to a private survey published on Tuesday.
The Caixin/Markit manufacturing Purchasing Managers’ Index (PMI), which gives an independent picture of the country’s industrial production, rose to 53.1 in the last month, compared to 52.8 in July. This is the highest rise since January 2011.
A figure above 50 in the PMI shows growth in manufacturing activity, while a reading below 50 signifies contraction.
According to the data published on Monday by the National Bureau of Statistics (NBS), the official PMI stood at 51 points in August.
Thus, both the NBS and IHS Markit figures exceeded forecasts and showed a recovery in the sector in the backdrop of an improved economy that continues to recover from the fallout of the coronavirus pandemic.
“The post-Covid 19 economic recovery is underway. New export orders have increased, for the first time this year above 50 points, and production is expanding. In addition, the labor market has seen signs of improvement,” said Wang Zhe, senior economist at Caixin Insight Group.
Wang said since the backlogs of factories have risen at a faster pace now, it could be a turning point for employment in the country.
“Employment remained an important focus. An expansion of employment relies on long-term improvement in the economy. Macroeconomic policy supports are essential, especially when there are still many uncertainties in domestic and overseas economies,” said Wang, in comments accompanying the data release.
According to the London-based economic research consultancy Capital Economics, the data, which is higher than predicted, suggests that Chinese manufacturing would continue to be as other countries gradually recover from the Covid-19 crisis.
“This month’s reading suggests that external demand is beginning to recover, which will accelerate the growth of Chinese exports in the coming months,” Capital Economics senior China economist Julian Evans-Pritchard said in a report sent to subscribers.
The economist added that the stimulus policies would maintain strong industrial growth and that the service sector was also accelerating that “should allow the Chinese economy to return to its pre-virus level by the end of this year.”
Zhao Qinghe, a senior statistician with the NBS, that “the supply-demand cycle is gradually improving.”
After imposing strict measures to control the spread of the novel coronavirus early this year, China’s economic growth rebounded in the second quarter of 2020, with a 3.2 percent year-on-year increase in the gross domestic product, according to official figures.
China’s GDP contracted 1.6 percent year-on-year during the first half of 2020. EFE-EPA