China’s manufacturing industry has returned to growth after a year of contraction. HSBC’s latest Flash Purchasing Managers’ Index™ for November is 50.4, up from 49.5 in October, indicating that businesses are starting to expand once more.
The critical figure of 50 signifies the difference between an industry shrinking or growing. November’s figure is the first time the PMI ™ has climbed above 50 since October 2011.
The index is compiled using the views of senior purchasing executives in more than 420 companies who comment on 11 areas of their business – from the level of new orders to input prices. It is seen as a key indicator to the health of the manufacturing industry in the world’s biggest exporter.
A number of crucial areas showed a shift from contraction to expansion during November, including new export orders and output. The Flash China Manufacturing Output Index hit 51.3, up from 48.2 in October, a 13-month high. But Qu Hongbin, HSBC’s chief economist for Greater China, warns that the industry continues to face unsettled times.
He said: “This confirms that the economic recovery continues to gain momentum towards the year end. However, it is still the early stage of recovery and global economic growth remains fragile.”
The Flash PMI is an initial estimate based on 90 per cent of the survey’s responses. November’s final PMI figure will be released on 3 December 2012.
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