Chinese manufacturing returns to growth as optimism improves, says Caixin
By Benjamin Chiou
Date: Friday 01 Nov 2024
(Sharecast News) - A private survey of China's manufacturing sector pointed to further signs of a recovery in October, with the Caixin purchasing managers' index (PMI) returning to positive territory.
The Caixin China manufacturing PMI rose to 50.3 last month from 49.3 in September, beating the 49.7 consensus forecast.
The survey showed that new orders increased at their fastest pace in four months, as optimism levels among manufacturers rose to a five-month high on hopes that better economic conditions and R&D efforts will support sales in the year ahead, Caixin said.
Firms also raised their purchasing activity and inventory holdings as confidence surrounding future output improved, though hiring still remained cautious with employment numbers falling again.
On Thursday, the official manufacturing PMI from the National Bureau of Statistics pushed above the neutral 50-point level for the first time in six months, after a barrage of stimulus measures announced by the government in September started to take effect.
"Data from the Caixin manufacturing PMI survey show that market demand stabilised and optimism improved, suggesting early signs of policy impact," said Wang Zhe, senior economist at Caixin Insight Group.
"However, the labor market remains under pressure, and price levels are still subdued. The effectiveness of these new policies in improving domestic demand, employment and livelihoods will require close monitoring. Additionally, achieving China's 2024 growth target will depend on a sustained recovery in consumer demand. That means policy efforts should focus on increasing household disposable income more effectively."
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