China factory surveys show economy weakening, as Beijing steps up support
The latest surveys of Chinese factory managers show the economy weakening in recent weeks, as the government ratchets up stimulus
China's economy weakened further in recent weeks, according to surveys released Monday, signaling the need for more support as the government ratchets up stimulus.
The Caixin purchasing managers survey showed new manufacturing orders fell at the fastest pace in two years in September.
“Operating conditions in China’s manufacturing sector deteriorated in September after improving during August,” the report said. “Furthermore, firms lowered their hiring and purchasing activity.”
An official survey released by the National Bureau of Statistics showed a less drastic decline but it marked a fifth straight month of contraction. The purchasing managers index was at 49.8 in September, up from a six-month low of 49.1 in August. The index is on a scale where figures above 50 indicate expansion.
The survey showed that factory output rose while new orders fell.
Chinese stock markets surged Monday, reflecting enthusiasm over a barrage of policy measures announced last week, including lower interest rates and smaller down payment requirements for mortgages and a cut in required bank reserves.
“There is no doubt that the coordinated and emphatic policy stimulus measures announced by Beijing have justifiably invoked optimism,” Tan Boon Heng of Mizuho Bank in Singapore said in a commentary.
The main index smaller market in Shenzhen soared 8.2% while the Shanghai Composite index jumped 5.7%
“The stimulus package announced last week should help shore activity over the coming months,” Gabriel Ng of Capital Economics said in a report. But he noted that imbalances between excess supply of many products versus
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