China’s Manufacturing Is Back in Expansion

China's factory activity unexpectedly returns to growth in November

Factory activity in China unexpectedly returned to growth in November for the first time in seven months, as domestic demand picked up on Beijing's accelerated stimulus measures to steady growth.

On top of that, according to Saturday's (November 30th) National Bureau of Statistics data, the Purchasing Managers' Index (PMI) for factory activity rebound to 50.2 in November from an earlier reading of 49.3 in October, beating an analysts' estimate of 49.5 and remarking its highest level since March this year. It stayed well above the 50-point mark that separates growth from contraction. Tom Mackenzie reports on "Bloomberg Daybreak: Australia".

But business confidence slipped and companies were reluctant to replenish their inventories, anxious about the uncertain outlook for demand and the prolonged China-US trade war. "But it remains to be seen whether the trend will be sustainable, as the risk of weakening demand still exists", said Liu Xuezhi, a senior researcher at the Bank of Communications' Financial Research Center. This will continue to give support to new orders in the coming year.

High-tech manufacturing and the manufacturing of equipment and consumer goods also saw expansion over two consecutive months, showing that the economy is on a transformative track toward high-quality growth and a consumption-driven model, Zhao said. Some analysts say that could be a sign that the government is anxious about the downward economic pressure.

A sub-index of new export orders climbed to a seven-month high at 48.8, but was still in contraction as demand wanes for China's exports overseas.

An additional 15% in United States tariffs are scheduled to take effect on about $156 billion of Chinese products on December 15.

The PMI survey also indicated factories continued to cut jobs in November despite slightly improved business confidence, while it signalled a further deterioration in profits for Chinese manufacturers, with output prices falling into a three-month low.

The country's monetary policy has become more accommodative to prevent a broader economic slowdown, with a focus on guiding more bank lending to smaller and private businesses.

NBS data also shows that the PMI for China's non-manufacturing sector came in at 54.4 in November, the highest since April, up from 52.8 in October, indicating that the non-manufacturing industry maintained its overall expansion momentum.



Latest news

India vet murder: Outrage mounts over Hyderabad rape killing
Not just the aam aadmi, but the celebrities have also come in support of the victim and have been demanding justice in the case. The woman had left home on her bike at about 18:00 local time (12:30 GMT) on Wednesday to go to a doctor's appointment.

Chiefs saw the good and bad of pass-interference reviews against Raiders
With so much at stake, the Chiefs need to play hard and put everything on the field over the next five weeks. Up next, the Chiefs face a huge matchup when they visit the New England Patriots next Sunday at 9.25pm.

College admissions scandal: Lori Loughlin's daughter Olivia Jade breaks silence
And not being able to say anything. "This is the best I can do and I want to move on with my life, not in a selfish way. While Olivia said there is not much she can share for legal reasons, she has greatly missed making YouTube videos.

US House Intelligence Committee to Vote Tuesday on Trump Impeachment Report
He said calls from Republicans for him to do so signal that "they are not serious about what they are doing". Jerrold Nadler, D-N.Y., to expand the witness list to include those sought by Republicans.

Marchand: Concussion spotter is 'busy eating pizza and cheeseburgers'
Sergachev worked his way down to the net and was on the spot for a loose puck to easily deposit 4:28 into the second period. Orlov became the hero 3:03 into overtime when he ripped a high short-side shot home for his second goal of the season.

Other news