China Factory Gauge Rises as Workers Weather Slowdown
A Chinese manufacturing gauge rose in October, adding to signs a resilient labor market and export demand are helping the world’s second-largest economy weather a housing market downturn.
The preliminary Purchasing Managers’ Index from HSBC Holdings Plc and Markit Economics was at 50.4, exceeding the median estimate of 50.2 in a Bloomberg News survey, which was also the level of September’s final reading. Numbers above 50 indicate expansion.
Chinese policy makers are trying to avoid a deeper slowdown after gross domestic product expanded 7.3 percent in the third quarter from a year earlier, the weakest pace in more than five years.
“The momentum of the rebound in September is continuing into the fourth quarter,” said Larry Hu, head of China economics at Macquarie Securities Ltd. in Hong Kong.
Output, new orders and new export orders all increased at a slower rate, while output and input prices decreased at a quicker rate, suggesting disinflationary pressure intensified.
“We continue to see downside risks,” said Ding Shuang, senior China economist at Citigroup Inc. in Hong Kong, as manufacturing activity isn’t as good as the headline number indicates.
Today’s report, known as the Flash PMI, is typically based on 85 percent to 90 percent of responses to surveys sent to purchasing managers at more than 420 companies. It showed employment and inventory indexes improved.
Source: bloomberg- China Factory Gauge Rises as Workers Weather Slowdown
