Chinese Manufacturing activity expanded in June
Chinese Manufacturing activity expanded in June for the first time in the last half year, sending a signal of a possible stabilization of the second largest economy in the world after months of stagnation. The PMI index of purchasing managers rose to 50.8 points compared to 49.4 points in May. Any level above the limit of […]
Chinese Manufacturing activity expanded in June for the first time in the last half year, sending a signal of a possible stabilization of the second largest economy in the world after months of stagnation. The PMI index of purchasing managers rose to 50.8 points compared to 49.4 points in May. Any level above the limit of 50 points separates expansion from contraction.
The market reaction was immediate, as the AUD rose against the USD, while Asian stocks widened their profits. The study of HSBC and Markit showed an overall improvement in the Chinese manufacturing sector, the majority of the 11 sub-indices recorded acceleration from previous months. More remarkable was the upturn in sub-index of the new orders, which rose to 15-month high of 51.8 points.
In recent months, Chinese authorities unleashed a series of modest economic measures named “mini-stimulus” to support growth in the second largest economy in the world. The tools include a reduction in the level of minimum reserves for banks that lend to the agricultural sector and small and medium-sized companies.
However, the recovery is uneven, prompting fears that the economy will not be able to justify the target rate of annual growth of 7.5%.
