Economy

China’s Oct factory, services activity break back into expansion

BEIJING (Reuters) -China’s manufacturing activity in October expanded for the first time in six months, an official factory survey showed on Thursday, supporting policymakers’ optimism that recent fresh stimulus will get the world’s No. 2 economy back on track.

The official purchasing managers’ index (PMI) rose to 50.1 in October from 49.8 in September, just above the 50-mark separating growth from contraction and beating a median forecast of 49.9 in a Reuters poll.

In a further encouraging sign, the non-manufacturing PMI, which includes construction and services, rose to 50.2 this month, after it dropped to 50.0 in September.

Policymakers are banking that further financial stimulus announced in late September will stabilise China’s $19 trillion economy and kick lending and investment back into gear, as a sharp property market downturn and frail consumer confidence continue to deter investors.

The mood in the manufacturing sector has been depressed for months by tumbling producer prices and dwindling orders. Furthermore, China’s exports, a lone bright spot, faded last month and the economy grew at the slowest pace since early 2023 in the third quarter.

Still, officials are publicly optimistic that this latest tranche of policy support will soon start to make itself felt.

China economists have previously pointed to how sentiment-based surveys often present a gloomier picture than hard data indicators. In the poll, one-in-three respondents forecast factory activity broke back into expansion this month.

In a worrying sign, however, industrial profits recorded the steepest monthly decline of the year in September, data showed on Sunday. The National Bureau of Statistics said that was due to factors such as insufficient demand.

Other recent indicators pointed to increased deflationary pressures and subdued loan demand, raising further red flags over the economic recovery and strengthening the case for even more stimulus to galvanise growth.

China is considering approving next week the issuance of over 10 trillion yuan ($1.40 trillion) in extra debt in the next few years, Reuters reported on Tuesday.

($1 = 7.1301 Chinese yuan)

This post appeared first on investing.com

You May Also Like

Editor's Pick

Sen. JD Vance (R-Ohio) and Minnesota Gov. Tim Walz (D) will face off Tuesday night at a CBS News vice-presidential debate in New York....

Latest News

A North Korean defector who escaped to the South more than a decade ago was detained after attempting to cross back into North Korea...

Economy

A U.N. human rights group confirmed Hamas’ leader in Lebanon, who was recently killed by Israeli strikes, was their employee.  Fateh Sherif was killed...

Investing

Astron (ASX:ATR) and Energy Fuels (TSX:EFR,NYSEAMERICAN:UUUU) have completed the establishment of a joint venture to advance the Australia-based Donald rare earths and mineral sands...

Disclaimer: balanceandcharge.com, its managers, its employees, and assigns (collectively “The Company”) do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

Copyright © 2024 balanceandcharge.com

Exit mobile version