China's manufacturing Purchasing Managers' Index (PMI) stood at a 13-month high of 50.5 in November, backed by increasing new business and expanding production, confirming that the Chinese economy continues to recover gradually, according to a report released by HSBC here on Monday.
November's final headline PMI, a gauge of performance in the manufacturing industry, edged up a notch from its flash reading of 50.4 to 50.5, the highest reading and the first above-50 reading in 13 months, the report said.
A PMI reading above 50 indicates growth, while a reading below 50 indicates contraction.
The details suggest that manufacturing activities were boosted by an expansion of output driven by a continuous increase of new business. The output sub-index rose above 50 for the first time in four months, to 51.3, its highest level in 13 months, while new business inflows rose for the second consecutive month, though moderated a bit to 50.8 from 51.2.
November's new export orders recorded its strongest reading to 52.1 in one year, compared with 46.7 in October. On the other hand, China's employment reduction eased to its slowest pace in nine months to 49 from 48.5 in October.
HSBC expects a continuation of policy easing to support the early stages of China's growth recovery, and the bank forecasts China's GDP growth to rebound modestly to around 8 percent year-on- year in the fourth quarter.