The Purchasing Managers’ Index was 50.9, the National Bureau of Statistics and China Federation of Logistics and Purchasing said today in Beijing, an 11-month high and up from 50.1 in February. A separate gauge from HSBC Holdings Plc and Markit Economics rose to 51.6 in March from 50.4. Readings above 50 indicate expansion.
Workers manufacture cotton yarn at a factory in Dali county, Shaanxi province, China. Photographer: Nelson Ching/Bloomberg
An employee welds metalwork during the manufacture of bicycles at the Giant Manufacturing Co. Ltd. factory in the Kunshan area of Suzhou, Jiangsu Province, China. Photographer: Nelson Ching/Bloomberg
A pickup in manufacturing will help the new government under Premier Li Keqiang sustain a rebound after factory output had the weakest January-February growth since 2009 and Goldman Sachs Group Inc. questioned the strength of exports. Faster expansion may also fuel inflation, spurring tighter monetary policy from the central bank.
“We are clearly in a lot better state than we were at the end of last year,” Alistair Thornton, a Beijing-based economist at researcher IHS Inc., said in a Bloomberg Television interview, terming the momentum “modest.” At the same time, the economy faces “fairly large headwinds” including property curbs and tighter supervision of so-called shadow banking, he said.
The government PMI was lower than the 51.2 median estimate of 26 analysts surveyed by Bloomberg News. The HSBC index (SHCOMP)’s final reading matched the median estimate of 10 analysts. The preliminary level issued March 21 was 51.7.