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China's manufacturing sector to slow down

Staff writer ▼ | December 18, 2013
China's manufacturing sector will likely see the slowest expansion in three months in December because of lower output growth, according to HSBC Holdings Plc.
China manufacturing
China manufacturingChina's manufacturing sector will likely see the slowest expansion in three months in December because of lower output growth, according to HSBC Holdings Plc.


A preliminary reading of the Purchasing Managers' Index for the manufacturing industry edged down to 50.5 in December from 50.8 in November, the lowest level since October, the bank said in a report. The production output sub-index slipped to 51.8 in December from 52.2 in November, pressuring the index.

Meanwhile, the new orders sub-index hit a nine-month high of 51.8 in December, compared with 51.7 in November, while the new export orders sub-index rose to 50.3 from 50.2 last month, suggesting stable market demand. A reading above 50 indicates expansion, while one below that level signals contraction.

The official PMI data for December will be released on January 1 by the National Bureau of Statistics and the China Federation of Logistics and Purchasing. HSBC will release its final PMI data on January 2.

Qu Hongbin, chief economist in China at HSBC, said that although December's preliminary manufacturing PMI reading slowed marginally from November's final reading, it still stands above the third quarter's average reading of 49.7. The latest reading implies that the manufacturing sector's recovery, which started in July, is still holding up. China's GDP growth should stabilize at about 7.8 percent year-on-year in the fourth quarter.


 

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