In a rare piece of optimistic news for the world's third-largest economy, China's manufacturing activity showed signs of recovering in January, data indicated on Feb. 4. Some economists said the data could signal that China's manufacturers had overcome the worst of the economic crisis, with companies exhausting their old stock and placing new orders.
"Manufacturing in China is still contracting, but the bottom is now in sight," said Sherman Chan, an analyst with Moody's Economy.com.
The government's purchasing managers' index, or PMI, rose to 45.3% in January, up from 41.2% in December and a record low of 38.8% in November, the official Xinhua news agency reported. A reading above 50 means the manufacturing economy is expanding, while a reading below 50 indicates an overall decline.
Citigroup economist Ken Peng cautioned that talk of a recovery could be premature."Being 'less bad' is not the same as 'recovery'," Peng said. Indeed, January's figure was the sixth consecutive month that the PMI was below 50%. And a similar survey by CLSA Asia-Pacific Markets, a leading independent brokerage, released on Feb. 2 gave less optimistic results. The CLSA China Purchasing Managers Index, stood at 42.2 in January, up only slightly from 41.2 in December.
China's manufacturing sector accounts for more than 40% of the nation's economy.
Copyright Agence France-Presse, 2009