HSBC data indicates signs of recovery
By Wang Yanlin |
May 3, 2012, Thursday
|
Print Edition
Print Edition
CHINA'S manufacturing activities in private and export-oriented companies continued to contract in April, albeit improving from a month earlier, an HSBC survey showed yesterday.
The HSBC Purchasing Managers' Index was 49.3 last month, up from 48.3 in March.
A reading under 50 indicates contraction.
In comparison, the official Purchasing Managers' Index, released by the China Federation of Logistics and Purchasing on Tuesday, reached a 13-month high of 53.3 in April. It indicated stronger conditions in large state-owned enterprises.
Qu Hongbin, chief economist for China at HSBC, said its PMI reading for April confirmed that the pace of China's slowdown had been stabilized.
"The gross domestic product growth in the first quarter is likely to be the cyclical trough," Qu said.
"As easing measures are starting to work and additional stimulus is on the way in the light of accommodative inflation outlook in the coming months, we expect Chinese GDP growth to bottom out in the second quarter and recover modestly to over 8.5 percent in the later half of this year," Qu said.
China's economic growth expanded 8.1 percent in the first quarter, the slowest in nearly three years due to weak exports and corrections in the property market. But there were signs of recovery, which was believed to have started in the middle of the first quarter when the Spring Festival holiday ended.
Industrial production rose 11.6 percent from a year earlier in the first quarter, up from 11.4 percent in January and February.
Manufacturers' profits fell 1.3 percent to 1.04 trillion yuan (US$165 billion) in the first three months, but that compared with a 5.2 percent drop over the first two months.
Zhou Hao, an economist at Australia and New Zealand Banking Group, said earlier that China's manufacturing sector had been accumulating strength and exports were better than expected, helping the nation's economy to bottom out in the second quarter.
China has lowered its gross domestic product growth target to 7.5 percent this year from 8 percent in place since 2005. But major institutions, including the World Bank and the International Monetary Fund, estimate 8.2 to 8.5 percent.
The HSBC Purchasing Managers' Index was 49.3 last month, up from 48.3 in March.
A reading under 50 indicates contraction.
In comparison, the official Purchasing Managers' Index, released by the China Federation of Logistics and Purchasing on Tuesday, reached a 13-month high of 53.3 in April. It indicated stronger conditions in large state-owned enterprises.
Qu Hongbin, chief economist for China at HSBC, said its PMI reading for April confirmed that the pace of China's slowdown had been stabilized.
"The gross domestic product growth in the first quarter is likely to be the cyclical trough," Qu said.
"As easing measures are starting to work and additional stimulus is on the way in the light of accommodative inflation outlook in the coming months, we expect Chinese GDP growth to bottom out in the second quarter and recover modestly to over 8.5 percent in the later half of this year," Qu said.
China's economic growth expanded 8.1 percent in the first quarter, the slowest in nearly three years due to weak exports and corrections in the property market. But there were signs of recovery, which was believed to have started in the middle of the first quarter when the Spring Festival holiday ended.
Industrial production rose 11.6 percent from a year earlier in the first quarter, up from 11.4 percent in January and February.
Manufacturers' profits fell 1.3 percent to 1.04 trillion yuan (US$165 billion) in the first three months, but that compared with a 5.2 percent drop over the first two months.
Zhou Hao, an economist at Australia and New Zealand Banking Group, said earlier that China's manufacturing sector had been accumulating strength and exports were better than expected, helping the nation's economy to bottom out in the second quarter.
China has lowered its gross domestic product growth target to 7.5 percent this year from 8 percent in place since 2005. But major institutions, including the World Bank and the International Monetary Fund, estimate 8.2 to 8.5 percent.
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