Statistics

China's PMI of manufacturing sector rises to 51.7% in Aug

(Xinhua)
Updated: 2010-09-01 09:38

BEIJING - The Purchasing Managers Index (PMI) of China's manufacturing sector rose to 51.7 percent in August, up 0.5 percentage points from July, the China Federation of Logistics and Purchasing (CFLP) said Wednesday.

August's figure marked an end to three consecutive months of decline, and it was the 18th straight month that the index was above 50 percent.

The PMI includes a package of indices to measure manufacturing sector performance. A reading above 50 percent indicates economic expansion, while that below 50 percent indicates contraction.

Among the 11 sub-indices, six, including production, new orders and input prices, increased in August, according to the CFLP.

Li Miaoxian, an analyst with Bank of Communications International Holdings Co, attributed the growth to seasonal factors, predicting September's PMI would continue the rise.

More stories:  PMI fall points to economic growth slowdown  China's manufacturing at slowest for 17 months  PMI of manufacturing sector falls to 52.1% in July  Manufacturing expands slower than expected

The PMI would exceed 50 percent in the second half, indicating China's economy would not undergo a major correction, said Li.

China's economy cooled in the second quarter as the gross domestic product (GDP) grew 10.3 percent, down from the 11.9-percent growth in the first quarter.

Zhang Liqun, a researcher with the State Council's Development Research Center, said a strong exports recovery, stable growth in domestic consumption and continuing expansion in investment would help fend off a substantial slowdown of the nation's economy.

But Zhang also warned that a sharp increase in input prices would raise pressures on enterprises to manage costs.

According to the CFLP, the input prices index was up 10.1 percentage points in August from July.