Positive PMI another sign of stabilizing Chinese economy
China's purchasing managers' index beat expectations to re-enter the expansion territory as the economy shows more signs of resilience and stability.
The PMI for China's manufacturing sector firmed up to 50.2 in November from 49.3 in October, the National Bureau of Statistics said Saturday.
As the country takes firm steps in further stabilizing the economy, market analysts believe that the above-expectation manufacturing PMI is yet another sign of China's economic resilience.
The improvement of the manufacturing PMI was broadly based, with rising sub-indices of production, new orders and raw materials inventory, said Lu Ting, chief China economist with Nomura, in a research note.
A report from Lianxun Securities echoed Lu's point, saying the 50.2-reading of November PMI was significantly higher than the October figure of 49.3, which expanded over 50 for the first time since May.
The institution attributed the rise of November PMI to production and new orders, which increased the figure by 0.45 and 0.51, respectively.
Growth drivers recovered with improvements in both the demand and supply side thanks to polices to sustain infrastructure development, relaxation of property investment regulations, and rising international demand, the report said.
China's economy might have passed the short-term low-point, the report noted, predicting that China will take measures to further stabilize economic growth in 2020.
"The overall verdict is cautiously optimistic," the Bank of China Research Institute said in the Report on Economic and Financial Outlook for 2020, which projected the annual growth rate of China's economy at 6.1 percent.
The report attributed the confidence to improving capital flows and corporate finance with relaxed global monetary policies, as well as consolidated automobile consumption.
China has allocated part of next year's special bonds quota worth 1 trillion yuan (about US$143 billion) in an effort to spur effective investment for shoring up weak areas and expanding domestic demand, according to the Ministry of Finance.
The country's economy expanded 6.2 percent in the first three quarters, within the government's annual target of 6 to 6.5 percent.
China's economic development is still resilient, with positive signs from the market, said Wen Bin with China Minsheng Bank.
For the next stage, the NBS stressed policy coordination and counter-cyclical regulation of macro-policies in the next stage to stabilize growth, especially in strengthening support for small and medium-sized enterprises.