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BEIJING (Reuters) – Chinese factory activity grew at the fastest rate of nearly a decade in August, backed by the first build-up of new export orders this year as brands increased production to meet emerging demand, a personal survey showed Tuesday.
The moment when the world’s largest economy has largely recovered from the coronavirus crisis, and the emergence of a bright spot in the forward-looking indicator of export orders may bring a more sustainable and broader recovery of the Chinese economy in the coming months..
Caixin/Markit Manufacturing’s Purchasing Managers Index (PMI) rose to 53.1 last month from 52.8 in July, marking the fourth consecutive month of expansion in the sector and the most powerful expansion rate since January 2011.
It beat analysts’ forecasts through a slight drop to 52.6. The 50 mark separates expansion from contraction per month.
The optimisty effects contrasted with an official poll Monday, which showed that Chinese manufacturing activity grew at a slower rate in August, with floods in southwest China disrupting production, although there were positive symptoms in any of the PMI.
The trend to improve in the official PMI for new export orders was similar to the personal survey, while the former also showed a forged expansion in the sector very important to drive continued recovery.economy following the surprise of the coronaviruses.
On Tuesday’s Caixin, Chinese factories reported the first backlog of new export orders this year in August, as countries eased COVID-19 restrictions to spice up their economies. The resumption of activity also led to a further expansion of production, marking the biggest gain. in almost a decade.
The labour market has also noticed signs of improvement, with some companies expanding hiring to meet production needs, the employment measure has remained in negative territory for the 8 consecutive months.
Wang Zhe, senior economist at Caixin Insight Group, said a change in employment is coming as factory buildup grows at a faster pace.
“Employment has remained a vital priority. The expansion of employment is based on a long-term improvement of the economy. Support for macroeconomic policies is essential, especially when there are still many uncertainties in the domestic and foreign economies,” he said Wang in an observation. that accompany the data.
A mirror factory in the Chinese city of Yiwu, which sells materials to retail giants such as Walmart and Home Depot, has been flooded with new businesses beyond the plant’s existing operational capacity, and control sent the entire sales team to the factory floors, a period of 23 years.told Reuters an old corporate salesman.
“We fired staff when the pandemic started, but now, with so many orders, we can’t locate enough people,” the seller said, adding that the company had trouble booking shipments because finished products were piling up in their warehouses.
Business optimism for next year among Chinese factories remained very strong, falling slightly in August. Businesses are concerned about the long-term severity of the global pandemic.
(Report through Stella Qiu and Ryan Woo; edited through Shri Navaratnam)