Tuesday, 04 December 2012 03:44
BEIJING: Manufacturing activity in China hit a 13-month high in November, HSBC said Monday, in another sign that the world's second largest economy is emerging from a drawn-out slumber.
The banking giant's purchasing managers' index (PMI) hit 50.5 last month, up from 49.5 in October, putting it above the 50 mark that indicates growth. A reading below signals contraction.
The figure signals a return to growth after 12 consecutive months of contraction as the crucial manufacturing sector has been hit by a global slowdown as well as the debt crisis in key market Europe, where demand for Chinese goods has slumped.
It is the highest reading since October last year, when the figure was 51, according to HSBC data.
China's official PMI reading also showed expansion in November for the second month in a row, hitting 50.6, compared with 50.2 in October and 49.8 in September.
Despite the news, Shanghai's composite index slipped, trading 0.36 percent lower in afternoon trade.
The HSBC index, compiled by information services provider Markit, tracks manufacturing activity and is a closely watched barometer of the health of the economy.
Qu Hongbin, a Hong Kong-based economist with HSBC, said: "This confirms the Chinese economy continues to recover gradually."
The bank expects China's economic growth to pick up modestly to around eight percent in the fourth quarter as government "easing measures continue to filter through", he added.
New export orders increased at "a market rate", with a number of firms linking the rise to a pick-up in demand, particularly in Europe and the United States, HSBC said.
Copyright APP (Associated Press of Pakistan), 2012