China’s factory activity improves in January, expectations stable
CHINA’S factory activity demonstrated improvement in January as businesses reported robust production and maintained an overall optimistic outlook, adding to the growing evidence the Chinese economy is off to a positive start this year.
The purchasing managers’ index for the manufacturing sector came in at 49.2 in January 2024, up from 49 in December last year, official data showed yesterday.
The figure rebounded after a threemonth decline from October 2023, indicating an improvement in manufacturing activity, according to data released by the National Bureau of Statistics. The PMI for December, November and October was 49, 49.4 and 49.5, respectively.
A reading above 50 indicates expansion; a reading below 50 reflects contraction.
The recovering PMI indicates an increase in supportive factors for the economy, contributing to its stability, said Zhang Liqun, an analyst with the China Federation of Logistics and Purchasing, noting that authorities have stepped up efforts to bolster the economy since the new year.
NBS senior statistician Zhao Qinghe said factories saw accelerated production and an increase in new orders in January, while their expectations stayed stable.
Driven by a robust food and beverage sector, entertainment, and medicine production, the sub-index for manufacturing production climbed to a four-month high. Export orders registered major improvement, reflecting recovering external demand, and new orders for equipment and high-tech manufacturing, as well as consumer goods, continued to expand.
The business outlook was stable, with the expectations of medicine, auto, and railway and shipping equipment producers persisting in high-climate territory.
Large enterprises saw their PMI return to the expansion zone, while mediumsized companies improved but were still in contraction terrain. The situation remained lackluster for small firms.
Yesterday’s data also showed that the country’s non-manufacturing activity, specifically in services and the construction sector, accelerated expansion in January with the PMI standing at 50.7, up from 50.4 in December.
The early January holiday boosted people’s willingness to travel and spend, which prompted increased activity levels in the retail, road transport, air transport and catering sectors, according to Zhao.
Concluding 2023 with an impressive 5.2 percent rise, the Chinese economy commenced the new year on a positive note.
A warm sentiment pervaded the entire country, evident in bustling tourist attractions and long queues at restaurants. During the three-day New Year holiday, China’s tourism revenue exceeded prepandemic 2019 levels, and box office sales hit a record high. The upcoming Spring Festival is expected to usher in another surge in trips and sales.
(Xinhua)