Chinese manufacturing recovered in August, raising confidence that the world's second-largest economy may help Asia avoid a double-dip recession, despite sluggish growth in Western nations.
The 'official' China PMI climbed to 51.7 from 51.2 in July, its first advance in four months, according to the China Federation of Purchasing & Logistics said. A reading above 50 indicates an expansion in manufacturing activity, while a reading below 50 indicates contraction.
HSBC's China PMI jumped to a three-month high of 51.9 from 49. ¨C indicating that manufacturing resumed growth after a small contraction in July.
The data "reconfirmed our long-held view that China is moderating rather than melting down," said Hongbin Qu, HSBC's chief economist for China.
HSBC expects Chinese economy to grow at an annual rate of 8 percent in the second half of the year "while external demand is more likely to turn worse in the coming months."
Asian equity markets responded with mixed results, however ¨C while the Nikkei of Japan and Hong Kong's Hang Seng showed moderate gains today, China's Shanghai composite index lost 0.60 percent.
Still, China's improving manufacturing picture stands in contrast to Taiwan and South Korea which have posted manufacturing declines, suggesting how much more exposed they are to Western economies than China is.
Mark Williams, senior China economist at Capital Economics, cautions however that both PMI figures in China are still at a very subdued level, suggesting that economic growth is
considerably weaker than China has been used to over most of the last decade.
¡°Still, the turnaround last month at least provides reassurance that growth is not collapsing,¡± he said.
www.EnergyChinaForum.com
¡°A key question now is whether the government will be happy for the pace of growth to settle at the relatively subdued level implied by the PMIs.¡±(Edited by EnergyChinaForum.com. For more information, please email to: info@energychinaforum.com)
(international business times,Sep 1,2010)
| |
