Beijing: China’s factory growth stabilized in
November aided by firm demand, a pair of surveys showed, a sign of
resilience in the world’s second-largest economy that augurs well for
its plans for structural reforms.
The final HSBC/Markit Purchasing Managers’ Index (PMI) stood at 50.8
in November, a survey showed on Monday, down a touch from October’s
50.9 but up from a preliminary reading of 50.4.
The encouraging outcome echoes an upbeat showing from the
official PMI, which clung to an 18-month high of 51.4 in November,
ahead of market expectations.
The upbeat results supported the Australian dollar—a
proxy for the Chinese growth engine—in early Asian trade and heartened
investors who worried that China’s economic growth may slip in the
fourth quarter.
Qu Hongbin, an economist at HSBC, said the final HSBC PMI
was revised up from its preliminary reading after firms reported more
business, but said spots of weakness in the PMI poll should prevent
China from tightening monetary policy.
“The renewed contraction of employment and the slower
pace of restocking activities call for a continuation of accommodative
policy,” he said.
With the economy growing at a rate of over seven per cent
and house prices clinging stubbornly to record highs, China’s leaders
have signalled lately that policy may be tightened slightly to temper
price pressures.
The latest PMI surveys showed China’s economic growth remained resilient in November.
A sub-index for new orders, a measure of domestic and
foreign demand, hit an eight-month high of 51.7 in November in the final
HSBC PMI.
New export orders fared less well and dipped to a
three-month low, but stayed above the 50-point threshold separating
growth from contraction. That suggested domestic consumption had picked
up some slack from soft foreign demand.
The official PMI released over the weekend also showed
new orders and export orders held firm in November, though export orders
displayed slightly more strength.
Benign growth outlook
After three decades of double-digit growth, analysts say
China’s economy has reached a turning point where traditional growth
drivers of heavy investment and brisk export sales must make way for a
more sustainable expansion in consumption.
Beijing has made it clear it would like to start the required changes.
China’s top leadership unveiled the boldest economic and
social reforms in nearly three decades last month that are expected to
give the Chinese economy new drivers of growth.
A Reuters poll in October showed China’s economy
is forecast to grow 7.5% in the fourth quarter, in line with the
government’s 2013 growth forecast, but down from 7.8% between July and
September.
For the year, economists believe growth may hit 7.6%, impressive by world standards, but still the worst for China in 14 years.
“The benign economic outlook in the near term provides
favourable condition for structural reforms,” Haibin Zhu, an economist
with JPMorgan, said on Monday.
“In the next three to six months, financial reform may
make further progress to illustrate the determination for structural
reform by new leaders,” he said.
Possible reforms include a widening of the yuan’s trading
band, approval of privately-owned banks and an introduction of deposit
insurance and certificates of deposit, Zhu said.
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source mint
Sales of compact cars comprising Swift, Estilo and Ritz were at 18,122
units as against 23,849 units in the year-ago month, down 24%. 
