Economic situation in Asia
Survey: Chinese industrial sentiment is brightening
The industry in China is proving to be more resilient than expected. A ray of hope, but it cannot hide all the problems.
After an unexpectedly significant improvement in sentiment in China’s industry in October, the signs point to growth again. The manufacturing purchasing managers’ index (PMI), based on a survey by business magazine Caixin, rose 1.0 point to 50.3, according to data released on Friday. The sentiment indicator thus recovered from the setback in September, when it fell to its lowest level in over a year.
Analysts had expected an improvement to just 49.7 points. The index value also climbed above the so-called growth threshold of 50 points, which indicates an increase in economic activity.
The indicator determined by the magazine “Caixin” shows the mood in the country’s smaller and private companies, which are also more export-oriented. On Thursday, China’s statistics office published the state-determined purchasing managers’ index, which captures the mood in the larger and state-owned companies. There was also a better mood here. The state indicator for industrial sentiment rose by 0.3 points to 50.1 points in October.
China’s economy is suffering from weak domestic demand
The manufacturing sector accounted for more than a quarter of China’s economic output in the first half of this year, according to official data. The mood of purchasing managers is considered an important leading indicator for the world’s second largest economy and is therefore closely followed on the financial markets.
China’s economy continues to suffer from weak domestic demand. Trade disputes with the EU and the USA, as well as a serious real estate crisis, are causing concerns for the government in Beijing, which had set a growth target of around five percent for this year.
dpa
Source: Stern
