by XIN Yuan
China's manufacturing activity contracted at a slower pace in November, helped by pro-growth measures and a modest improvement in trade sentiment, though underlying demand remained weak.
The official manufacturing Purchasing Managers' Index rose to 49.2 last month from 49.0 in October, the National Bureau of Statistics said on Sunday. It was the third consecutive month below the 50-point threshold separating expansion from contraction.
WANG Qing, chief macro analyst at Golden Credit Rating, told Jiemian News that stimulus unveiled in late September — including two 500-billion-yuan (about US$70-billion) packages — has begun to filter through. One tranche of new policy-based lending was fully issued in October, and the year-end issuance of 500 billion yuan in special bonds will add roughly 200 billion yuan in fiscal resources for infrastructure and manufacturing projects, he said.
Wang added that progress in late-October China–US economic talks helped steady sentiment. But he cautioned that the property slump, soft consumer and investment activity, and the impact of higher US tariffs in the fourth quarter kept factory conditions subdued. "Another round of growth-support measures cannot be ruled out," he said, pointing to stronger fiscal support, looser monetary conditions and moves to stabilize the housing market.
The sub-indices showed mild improvement. The production index rose 0.3 point to 50.0, signaling stable output, while the new-orders index climbed 0.4 point to 49.2. New export orders jumped 1.7 points to 47.6, though still in contraction.
Large manufacturers weakened, with their PMI slipping to 49.3, while medium-sized and small firms edged up to 48.9 and 49.1. All remained below 50.
Outside the factory sector, the non-manufacturing PMI fell 0.6 point to 49.5. Construction activity inched up to 49.6, while the services index dropped to 49.5. Rail transport, telecom and broadcasting, and monetary and financial services stayed above 55, whereas real estate and household services remained below the threshold.
