China's factory activity stuns with fastest growth in a decade since 2012, investors more optimistic on China's economic prospects

[beijingwalker]

China's factory activity stuns with fastest growth in a decade since 2012, investors more optimistic on China's economic prospects​

March 1, 202310:55 AM GMT+8s

BEIJING, March 1 (Reuters) - China's manufacturing activity expanded as the fastest pace in more than a decade in February, an official index showed on Wednesday, smashing expectations as production zoomed after the lifting of COVID-19 restrictions late last year.

The manufacturing purchasing managers' index (PMI) shot up to 52.6 from 50.1 in January, according to the National Bureau of Statistics, above the 50-point mark that separates expansion and contraction in activity. The PMI far exceeded an analyst forecast of 50.5 and was the highest reading since April 2012.

The world's second-largest economy recorded one of its worst years in nearly half a century in 2022 due to strict COVID lockdowns and subsequent widespread infections. The curbs were abruptly lifted in December as the highly transmissible Omicron spread across the country.

Global markets cheered the big surprise in the PMI with Asian stocks and the Australian dollar reversing earlier losses, the offshore yuan perking up and oil rallying, as investors took a more optimistic view on China's economic prospects.

"While we need to treat these numbers will caution as there might be significant seasonal and event factors, the overall trend still points to a solid recovery at the beginning of 2023," said Zhou Hao, economist at Guotai Junan International.

Markets expect the annual meeting of parliament, which kicks off this weekend, will set economic targets and elect new top economic officials.

"The decent PMI readings provide a positive note for the upcoming National People's Congress. We expect the government to roll out further supportive policies to cement the economic recovery," said Zhou.

The official PMI came out just before an upbeat private sector index from Caixin/S&P that showed activity rising for the first time in seven months.

Businesses accelerated their resumption of work and production, as the effect of economic stabilisation policies was felt by the sector while the impact of COVID-19 receded, the NBS said in a separate statement.

While the manufacturing sector has started to see more signs of recovery, it had remained under pressure with factory-gate prices falling in January due to still cautious domestic consumption and uncertain foreign demand.

The official non-manufacturing purchasing managers' index (PMI) rose to 56.3 from 54.4 in January, indicating the fastest pace of expansion since March 2021.

On Friday, China's central bank said the domestic economy was expected to generally rebound in 2023, although the external environment remained "severe and complex."

The composite PMI, which includes both manufacturing and non-manufacturing activity, rose to 56.4 from 52.9.

China's factory activity stuns with fastest growth in a decade

China's manufacturing activity expanded as the fastest pace in more than a decade in February, an official index showed on Wednesday, smashing expectations as production zoomed after the lifting of COVID-19 restrictions late last year.

www.reuters.com

 

[beijingwalker]

China’s factory activity grows further, marks its highest reading in nearly 11 years​

PUBLISHED TUE, FEB 28 20238:44 PM EST

KEY POINTS

• China’s official manufacturing PMI hit 52.6 in February, above the 50-point mark that separates growth from contraction.
• China Beige Book’s chief economist Derek Scissors expects to see an improvement in consumption later this year.

China’s factory activity for February bounced further into expansion territory, according to data from the National Bureau of Statistics.

The official manufacturing purchasing managers’ index rose to 52.6 in February – above the 50-point mark that separates growth from contraction. That marks the highest reading since April 2012, when it hit 53.5.

February’s PMI reading is also higher than the 50.1 reported for January and above expectations of 50.5, according to economists surveyed by Reuters.

Non-manufacturing PMI also grew further to 56.3 from January’s print of 54.4, when it saw a sharp improvement backed by a recovery in services and construction activity.

The Chinese onshore yuan stood at 6.9325 against the U.S. dollar while the offshore yuan strengthened 0.15% to 6.9480 against the greenback.

China Beige Book’s chief economist Derek Scissors told CNBC’s “Squawk Box Asia” he expects to see an improvement in consumption later this year – buoyed by any announcements from the upcoming National People’s Congress meetings.

“I think April’s really the time that consumers will take cues from the March National People’s Congress meetings and the announcements made there,” said Scissors.

He added, “In April, we should see where the course of Chinese consumption is going. It will be better than last year, but it won’t be much better and the people relying on that may be disappointed.”

China’s National Party Congress kicks off on Sunday.

China's factory activity grows further, marks its highest reading in nearly 11 years

China's official manufacturing purchasing managers’ index rose to 52.6 in February – marking the highest reading since April 2012.

www.cnbc.com

 

[beijingwalker]

Asia's factory activity stalls, but China a bright spot​

By Leika Kihara

TOKYO, March 1 (Reuters) - Asia's factory activity stalled in February with the exception of China, as slowing global demand, stubbornly high inflation and the fallout from past interest rate hikes weighed on the region's economies, surveys showed on Wednesday.

Recovering momentum in China following its exit from stringent COVID-19 policies late last year offered hopes of a more subdued downturn in the global economy, as the U.S. Federal Reserve stays on its higher for longer interest rate path.

China's manufacturing activity expanded at the fastest pace in more than a decade in February, according to an official index, while a private sector survey also showed activity rising for the first time in seven months.

India and Australia saw economic growth slow in the quarter to December, and South Korea's exports fell in February for a fifth straight month, highlighting the pain slowing global demand was inflicting on the region's manufacturers.

The region's weaker data underscores the challenge Asian policymakers face in reining in inflation with higher interest rates, without choking off their economic recoveries already facing pressure from the global economic slowdown, analysts say.

"Overseas economies are showing stronger signs of slowdown" as the effect of fast-pitched interest rate hikes begin to appear in many countries, Bank of Japan (BOJ) board member Junko Nakagawa said on Wednesday.

China's recovering economy, the world's second largest, may not be enough to offset headwinds from weak chip demand and supply constraints for export-reliant economies such as Japan.

Japan's final au Jibun Bank PMI fell to 47.7 in February from January's 48.9, dropping at the fastest pace in more than two years, a survey showed on Wednesday.

The weak outcome followed data showing a big drop in Japan's factory output in January on slumping production of cars and semiconductor equipment, casting doubt on the BOJ's view the economy was on course for a steady recovery.

Factory activity continued to shrink in Taiwan and Malaysia in February, and expanded at a slower pace than in January in the Philippines, surveys showed.

Separate data showed South Korea's exports fell 7.5% in February from a year earlier, marking the fifth straight month of declines, partly due to a plunge in semiconductor exports.

Policymakers hope China's re-opening from COVID-19 curbs, and resilience seen so far in U.S. and European economies, will underpin global growth this year.

The International Monetary Fund last month raised its 2023 global growth outlook slightly due to "surprisingly resilient" demand in the United States and Europe, an easing of energy costs and the reopening of China's economy after Beijing abandoned its strict COVID restrictions.

Asia's factory activity stalls, but China a bright spot

Asia's factory activity stalled in February with the exception of China, as slowing global demand, stubbornly high inflation and the fallout from past interest rate hikes weighed on the region's economies, surveys showed on Wednesday.

www.reuters.com

 

[beijingwalker]

China’s factories just had their best month in nearly 11 years as economy rebounds after reopening​

By Laura He, CNN
Published 12:49 AM EST, Wed March 1, 2023

China’s factory activity has expanded at the fastest pace in more than a decade, as the world’s second largest economy staged what economists are calling a “very rapid” rebound after reopening from zero-Covid.

The government’s official purchasing managers’ index (PMI) for the manufacturing industry hit 52.6 in February, the highest level since April 2012, according to data released Wednesday by the National Bureau of Statistics.

In January, the reading was 50.1, a sharp increase from the month before, as disruptions caused by the abrupt end of pandemic restrictions was starting to fade. China scrapped most of those restrictions in early December.

A reading below 50 indicates contraction, while anything above that shows expansion.

The official non-manufacturing PMI for February, which includes the construction and services industries, recorded its best level in two years, figures from the NBS showed. The reading was at 56.3, compared to 54.4 in January.

Also Wednesday, the Caixin/Markit manufacturing PMI, a private gauge of the country’s factory activity, jumped to 51.6 in February from 49.2 in January. It was the first expansion in seven months.

The official PMIs mainly cover larger businesses and state-owned companies, while the Caixin readings are more focused on smaller businesses and private companies.

The robust data has boosted Asian stocks. Hong Kong’s Hang Seng Index was up more than 3%, leading gains in the region, and poised to record the biggest daily increase in three months.

The latest data is “exceptionally strong,” confirming a “very rapid rebound” in China’s economic activity, Julian Evans-Pritchard, head of China economics at Capital Economics, wrote in a research note.

“They underscore just how quickly activity has bounced back following the reopening wave of infections,” he said, adding that his firm’s 5.5% growth forecast for China this year may be too conservative.

On Wednesday, Moody’s Investors Services raised its forecast for China’s real GDP growth to 5% for both 2023 and 2024, up from 4% previously, citing a “stronger than expected” rebound in the short term after the government fully relaxed Covid

https://edition.cnn.com/2023/03/01/economy/china-pmi-rebound-reopening-intl-hnk/index.html

 

[DabbuSardar]

This is good, world cannot afford china in a recession right now.
Lets get over the covid saga and keep up growing

 

[beijingwalker]

China to outperform global peers for next 12 months: Stan Chart
Mar 2, 2023 11:09 AM IST

China to outperform global peers for next 12 months: Stan Chart

In an interview with CNBC-TV18, Abhilash Narayan, Senior Investment Strategist at Standard Chartered Bank said that investors' inflow into Chinese equities is likely to lead to outperformance. He also recommended investors remain overweight on China while remaining neutral on India.

www.cnbctv18.com

 

[beijingwalker]