China’s non-manufacturing industries expanded at a faster pace in October, adding to evidence the world’s second-biggest economy is recovering after a seven- quarter slowdown.
The purchasing managers’ index rose to 55.5 from 53.7 in September, the National Bureau of Statistics and China Federation of Logistics and Purchasing said in Beijing today. A reading above 50 indicates expansion.
Today’s report may bolster expectations for a rebound in economic growth this quarter after a similar measure for manufacturing expanded for the first time in three months. The data may reduce pressure on policy makers to roll out more stimulus as they start a once-a-decade power transfer next week.
“There are increasing signs that the pickup of economic activity in is more than a one-off phenomenon,” Ding Shuang, senior China economist at Citigroup Inc. in Hong Kong, said before the announcement. The central bank “seems determined to keep liquidity adequate and monetary policy remains accommodative,” he said.
China’s economic growth cooled to a three-year low of 7.4 percent in the third quarter as Premier Wen Jiabao’s campaign to curb consumer and property prices damped domestic demand and a sluggish global recovery capped the nation’s exports.
The Shanghai Composite Index, the nation’s benchmark stock gauge, had its best weekly rally in more than a month on speculation that economic growth is rebounding, rising 2.5 percent in the five days ending Nov. 2.
Industrial-production growth accelerated for the first time in four months in September, retail sales expanded at the fastest pace since April and fixed-asset investment growth quickened, signalling economic momentum is picking up.
Manufacturing expanded for the first time in three months in October, a Nov. 1 report from the statistics bureau and logistics federation showed, and a private survey released the same day by HSBC Holdings Plc and Markit Economics was at an eight-month high.
China Cosco Holdings Co., the nation’s biggest listed shipping company, reported a smaller loss in the third quarter compared with the same period a year ago and its rival China Shipping Container Lines Co., returned to profit as container rates increased.
Bank of America Corp in Hong Kong, this week raised its estimate for fourth-quarter economic growth to 7.8 percent from 7.5 percent while Nomura Holdings Inc. projects a rebound to 8.4 percent.
The non-manufacturing PMI is based on responses from purchasing managers at 1,200 companies in 27 industries including catering, construction and aviation transportation.Source: Bloomberg “China’s Non-Manufacturing Industries Expand at a Faster Pace”
- China’s services sector rebounds (todayonline.com)
- China’s Non-Manufacturing Activity Rises In October: Official PMI (ibtimes.com)
- China April HSBC services PMI rises to 6-month high (chinadailymail.com)