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Manufacturing in China growing, ADB downscaled growth

Staff writer |
Manufacturing production continued to pick up for the third consecutive month in September, driven by the expansion of new orders and exports, sending positive signals for overall economic growth in the third quarter.

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The National Bureau of Statistics and the China Federation of Logistics and Purchasing reported on Tuesday that the manufacturing Purchasing Managers' Index climbed to 51.1 in September from 51.0 in August, the highest since May 2012.

The sub-index indicated that new orders rose to 52.8 from 52.4 in August, and export orders increased to 50.7 from 50.2, according to the official figures. If the reading is above 50 it signals expansion in the manufacturing sector, while below 50 shows contraction.

Positive factors for the whole economy have been accumulating since the second quarter, supported by a series of economic policies targeting long-term growth stabilization, economists said.

However, the September PMI showed a contrary situation between small and bigger manufacturing firms. For the small-scale business, the PMI was 48.8, down from 49.2 in August, which showed a more serious contraction.

At the same time, the Asian Development Bank (ADB) downscaled this year's growth forecast for China to 7.6 percent due to weak domestic demand. In April, the ADB had predicted the Chinese economy to grow at 8.2 percent and then further bumped its forecast down to 7.7 percent in July. In its latest report issued on Wednesday, it estimated that China would post a 7.4 percent growth rate in 2014.

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