Caixin PMI shows slower growth in November

Expansion was the slowest in five months, but the economic outlook remains stable.

China’s manufacturing activity in November expanded at its slowest pace in five months but the economic outlook remained stable, a private sector report released on Friday showed.

The Caixin China General Manufacturing Purchasing Managers' Index dipped to 50.8 from October’s 51, according to the survey conducted by financial information service provider Markit and sponsored by Caixin Media Co Ltd.

A reading above 50 indicates expansion, while a reading below that means a contraction.

Sub-indexes showed output and new orders rose only modestly, leading to a softer expansion in buying activity.

At the same time, companies faced a further sharp increase in average input costs, and efforts to cut costs contributed to another fall in staffing levels, with the rate of decline hitting a three-month record, the report said.

“For the most part, the manufacturing sector remained stable in November, although some signs of weakness emerged,” Zhong Zhengsheng, director of macroeconomic analysis at CEBM Group said.

“In the fourth quarter, the economy is likely to maintain the stability observed since the start of the second half of the year.”

He added that China’s economic growth in 2017 is expected to be higher than last year’s 6.7 percent, but it may come under downward pressure in 2018.

The official PMI released on Thursday edged up to 51.8 from October’s three-month low of 51.6.

The difference between the official PMI and Caixin's is common as the official data covers 3,000 large and small companies and the Caixin index covers only 500 — mainly small and medium-sized businesses.

Nomura Holdings said in a note yesterday that it expected China's GDP to rise 6.6 percent in the fourth quarter, compared with 6.8 percent in the third quarter.

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