China’s Manufacturing Sector Grows at Fastest Pace Since January 2011
Arslan Butt • 1 min read
Factory activity across China increased at the fastest pace in almost 10 years during August as new export orders rose for the first time this year even as production levels rose to meet the pick-up in demand. China’s Caixin/Markit Manufacturing PMI rose to 53.1 in August from 52.8 in July, staying above the 50-threshold indicating expansion for the fourth consecutive month.
The reading even beat economists’ forecast for a slide lower to 52.6 instead. The PMI reading has also come in better than China’s official PMI reading which released on Monday and revealed a slight reduction in the pace of expansion in the manufacturing sector due to the floods.
However, both PMI figures indicate an uptick in new export orders supporting a rebound in the sector. New export orders grew for the first time in 2020 as China’s trade partners emerged out of lockdowns imposed due to the coronavirus pandemic.
Production levels across manufacturing companies also increased as orders received climbed higher. The manufacturing sector also increased hiring activity to help with the rise in production activity, even though the sub-index measuring employment levels continues to indicate contraction for the eighth consecutive month.