China’s factory activity returns to growth in September

Factory activity in China crept back to growth in September, official data showed Tuesday, providing a positive sign for the country’s leaders after two months of contraction.

The data came a day after Beijing announced a stimulus package to offset economic strains and low spending in the world’s second-largest economy.

The manufacturing purchasing managers’ index (PMI), a closely watched gauge of industrial health, came in at 50.1 this month, just above the 50 mark separating expansion from contraction.

The data from the National Bureau of Statistics was in line with the forecast in a Bloomberg survey of economists — and an improvement of the 49.8 and 49.2 recorded in July and August respectively.

NBS statistician Huo Lihui said in a statement it showed “that there has been recovery in economic (conditions)”.

Huo noted that “three key industries show rapid expansion”, including equipment manufacturing, high-tech manufacturing and the consumer goods industries.

“Production and operations in the relevant industries remained robust overall,” he added.

The non-manufacturing PMI, which measures activity in other areas including services and construction, came in at 50.2, the data showed.

That outstripped a Bloomberg forecast of 49.2 and was up from last month’s 49.0.

“The construction industry’s business activity index rose to its highest level this year,” Huo added.

Leaders in Beijing are seeking to maintain economic pace despite hurdles including trade frictions with Washington and an entrenched property-sector crisis that has spooked consumers.

Beijing on Monday announced “a package of pragmatic and effective incremental policy measures” to support the economy, including mortgage subsidies and expanded central bank support.

The government will introduce measures aimed at stabilising the property market and promoting employment and income growth, state news agency Xinhua said.

China’s economy has been supported by a historic boom in exports that has shown no sign of stopping in recent months.

It has also been helped by the global artificial-intelligence frenzy that has increased demand for its tech products.

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