China’s industrial activity expands at fastest growth in nearly a decade
Beijing, Nov 2 (efe-epa).- China’s industrial activity expanded at the fastest pace in nearly a decade, according to a private business survey released on Monday, giving more momentum to an economy recovering from the coronavirus impact.
The Caixin/Markit Manufacturing Purchasing Managers Index (PMI) rose to 53.6 in October from 53.0 in September.
A reading of more than the 50-point threshold in the official gauge of activity indicates growth, while a number below 50 signals a contraction.
The index, by the British British information provider, IHS Markit, gives an independent snapshot of the manufacturing sector in China.
The October reading was the highest since January 2011 and marked the sixth straight month of expansion.
“The recovery was the word in the current macro economy, with the domestic epidemic under control. Manufacturing supply and demand improved at the same time,” Wang Zhe, senior economist at Caixin Insight Group, wrote in a note on the survey.
On Saturday, the official data showed that the manufacturing purchasing managers’ index (PMI) of China slipped to 51.4 in October from 51.5 in the preceding month.
The number is below the Caixin survey but still indicates the expansion for the eighth consecutive month and is slightly lower than the 51.5 of September – the best performance so far this year, according to the National Bureau of Statistics (NBS) findings.
Both the official government and Caixin private indicators exceeded forecasts by analysts, confirming that the Chinese manufacturing sector is recovering after the fall in activity at the beginning of the year when China suffered the most from the effects of the pandemic of the Covid-19.
Wang highlighted that the sub-index for new orders expanded at its highest rate since November 2010, which would mean that the recovery in the manufacturing sector was not only due to the supply sector but also because of the demand.
He, however, sounded cautious about the effects of the pandemic in other countries.
The expert said that the demand from abroad recovered at a much slower rate in September, although the indicator of new export orders continued to expand for the third month in a row.
“The second wave of coronavirus infections in Europe and the third wave in the US have significantly suppressed China’s overseas demand,” Wang said.
The survey found nearly a third of companies in the manufacturing sector sounded confident that their business would improve in the next 12 months thanks to, among other factors, the control of the coronavirus outbreak in China.
China has practically controlled the Covid-19 outbreak in the country, according to official figures.
That has allowed China to recover from the economic impact it suffered at the beginning of the year.
The Chinese GDP fell 6.8 year-on-year in the first quarter, after advancing 3.2 percent and 4.9 percent in the next two quarters. The economy accumulated growth of 0.7 percent until September.
China will likely end the year with a predicted expansion of nearly 2 percent. EFE-EPA