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China Focus: Manufacturing activity expands again, non-manufacturing PMI rebounds

Source: Xinhua 2016-10-01 21:38:25

Workers debug devices at a welding workshop in a factory of Beijing Hyundai Motor in Cangzhou, north China's Hebei Province, Sept. 8, 2016. China's manufacturing Purchasing Managers' Index (PMI) stood at 50.4 in September, unchanged from August, while the non-manufacturing PMI increased to 53.7 from the previous month's 53.5, official data showed on Oct. 1, 2016. (Xinhua/Mou Yu)

BEIJING, Oct. 1 (Xinhua) -- China's manufacturing Purchasing Managers' Index (PMI) expanded again in September, while the non-manufacturing PMI increased at faster pace, adding to signs that the world's second-largest economy is stabilizing.

The manufacturing PMI stood at 50.4 in September, unchanged from August and staying above the 50-point mark that separates expansion from contraction for the second month in a row, according to data jointly released by the National Bureau of Statistics (NBS) and the China Federation of Logistics and Purchasing (CFLP).

Driven by infrastructure and real estate, the non-manufacturing PMI increased to 53.7 from 53.5 the previous month, remaining above the boom-bust line for seven consecutive months.

NBS statistician Zhao Qinghe said both production and demand showed signs of stabilization in the manufacturing sector, while the non-manufacturing sector is gradually picking up steam as enterprise confidence builds strength.

The manufacturing sub-index for production moved up to 52.8 from 52.6 in August, rising for the second consecutive month. The index for new orders was slightly down from the previous month, but remained in expansionary territory.

The non-manufacturing sub-index for new orders rose to 51.4 in September, its highest level in 2016, indicating demand in the sector is picking up.

The September PMI data suggest that China's economic fundamentals remain sound, laying a solid foundation for stable economic growth in the fourth quarter, said Cai Jin, deputy head of the CFLP.

Pointing to an increasing divergence between large companies and small to medium-sized companies, Liu Liu, an economist with China International Capital Corporation, said current economic growth was more driven by state-owned enterprises, while private investment remained weak.

The manufacturing PMI for large enterprises rose to 52.6 from 51.8 the previous month. For medium-sized and small enterprises the PMI fell 0.7 points and 1.3 points, respectively, remaining in contraction.

The data came on the heels of the Caixin manufacturing PMI, a private gauge of manufacturing activity, which showed the index was in expansionary territory for the second time since February 2015.

The Caixin manufacturing PMI edged up to 50.1 in September from 50 the previous month, according to a survey conducted by financial information service provider Markit, sponsored by Caixin Media.

The PMI data represent the latest in a series of economic indicators showing modest improvement in the economy. Earlier this month, official data showed increases in industrial output, retail sales and industrial company profits.

With the average manufacturing PMI for the third quarter being above the boom-bust line and higher than in the second quarter, Chen Zhongtao, analyst with the China Logistics Information Center, expects China's third-quarter GDP growth to be around 6.8 percent.

To further boost growth, Chen said policy makers should push through supply-side structural reform, improve the business environment and foster new engines of growth.

CFLP analyst Wu Wei warned of a property price jump in China's major cities, which he said may fan an asset price bubble. Overheating property markets have forced many local governments to impose home-purchase restrictions, with Beijing and Tianjin joining the list Friday.

China's GDP grew 6.7 percent in the second quarter of the year, the lowest level since the global financial crisis in early 2009 but remaining within the government's annual target range of 6.5-7 percent for 2016.

The country is scheduled to release its third-quarter GDP growth rate on Oct. 19.

 
China Focus: Manufacturing activity expands again, non-manufacturing PMI rebounds
                 Source: Xinhua | 2016-10-01 21:38:25 | Editor: huaxia

Workers debug devices at a welding workshop in a factory of Beijing Hyundai Motor in Cangzhou, north China's Hebei Province, Sept. 8, 2016. China's manufacturing Purchasing Managers' Index (PMI) stood at 50.4 in September, unchanged from August, while the non-manufacturing PMI increased to 53.7 from the previous month's 53.5, official data showed on Oct. 1, 2016. (Xinhua/Mou Yu)

BEIJING, Oct. 1 (Xinhua) -- China's manufacturing Purchasing Managers' Index (PMI) expanded again in September, while the non-manufacturing PMI increased at faster pace, adding to signs that the world's second-largest economy is stabilizing.

The manufacturing PMI stood at 50.4 in September, unchanged from August and staying above the 50-point mark that separates expansion from contraction for the second month in a row, according to data jointly released by the National Bureau of Statistics (NBS) and the China Federation of Logistics and Purchasing (CFLP).

Driven by infrastructure and real estate, the non-manufacturing PMI increased to 53.7 from 53.5 the previous month, remaining above the boom-bust line for seven consecutive months.

NBS statistician Zhao Qinghe said both production and demand showed signs of stabilization in the manufacturing sector, while the non-manufacturing sector is gradually picking up steam as enterprise confidence builds strength.

The manufacturing sub-index for production moved up to 52.8 from 52.6 in August, rising for the second consecutive month. The index for new orders was slightly down from the previous month, but remained in expansionary territory.

The non-manufacturing sub-index for new orders rose to 51.4 in September, its highest level in 2016, indicating demand in the sector is picking up.

The September PMI data suggest that China's economic fundamentals remain sound, laying a solid foundation for stable economic growth in the fourth quarter, said Cai Jin, deputy head of the CFLP.

Pointing to an increasing divergence between large companies and small to medium-sized companies, Liu Liu, an economist with China International Capital Corporation, said current economic growth was more driven by state-owned enterprises, while private investment remained weak.

The manufacturing PMI for large enterprises rose to 52.6 from 51.8 the previous month. For medium-sized and small enterprises the PMI fell 0.7 points and 1.3 points, respectively, remaining in contraction.

The data came on the heels of the Caixin manufacturing PMI, a private gauge of manufacturing activity, which showed the index was in expansionary territory for the second time since February 2015.

The Caixin manufacturing PMI edged up to 50.1 in September from 50 the previous month, according to a survey conducted by financial information service provider Markit, sponsored by Caixin Media.

The PMI data represent the latest in a series of economic indicators showing modest improvement in the economy. Earlier this month, official data showed increases in industrial output, retail sales and industrial company profits.

With the average manufacturing PMI for the third quarter being above the boom-bust line and higher than in the second quarter, Chen Zhongtao, analyst with the China Logistics Information Center, expects China's third-quarter GDP growth to be around 6.8 percent.

To further boost growth, Chen said policy makers should push through supply-side structural reform, improve the business environment and foster new engines of growth.

CFLP analyst Wu Wei warned of a property price jump in China's major cities, which he said may fan an asset price bubble. Overheating property markets have forced many local governments to impose home-purchase restrictions, with Beijing and Tianjin joining the list Friday.

China's GDP grew 6.7 percent in the second quarter of the year, the lowest level since the global financial crisis in early 2009 but remaining within the government's annual target range of 6.5-7 percent for 2016.

The country is scheduled to release its third-quarter GDP growth rate on Oct. 19.

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