China's manufacturing activity expands at fastest pace since 2012

China's manufacturing activity expanded as the fastest pace in more than a decade in February, official data showed on Wednesday, smashing expectations as production zoomed after the lifting of COVID-19 restrictions late last year.
 

The official manufacturing purchasing managers' index (PMI) stood at 52.6 against 50.1 in January, according to data from the National Bureau of Statistics, above the 50-point mark that separates expansion and contraction in activity on a monthly basis. The PMI far exceeded an analyst forecast of 50.5 and was the highest reading since April 2012.
 

The world's second-largest economy recorded one of its worst years in nearly half a century in 2022 due to strict COVID lockdowns and subsequent widespread infections. The curbs were abruptly lifted in December as the highly transmissible Omicron spread across the country.
 

Businesses accelerated their resumption of work and production, as the effect of economic stabilisation policies was felt by the sector while the impact of COVID-19 receded, said the statistics bureau in a separate statement.

 

While the manufacturing sector has started to see more signs of recovery, it had remained under pressure with factory-gate prices falling in January due to still cautious domestic consumption and uncertain foreign demand.
 

On Friday, China's central bank said the domestic economy was expected to generally rebound in 2023, although the external environment remained "severe and complex." The official non-manufacturing purchasing managers' index (PMI) rose to 56.3 from 54.4 in January.
 

The composite PMI, which includes both manufacturing and non-manufacturing activity, rose to 56.4 from 52.9.

Xi for overhaul of govt agencies

President Xi Jinping signaled the unveiling of an overhaul of China’s government agencies when the country’s legislature holds an annual gathering starting next week.

Broad reforms to agencies in both the government and the ruling Communist Party will focus on key industries and sectors in a “relatively intensified” manner, Xi told officials Tuesday at a conference in Beijing. These changes will affect the interests of many, Xi said, according to a readout from the official Xinhua News Agency. 

Xi will embark on a new term as president at the National People’s Congress, after having extended his leadership of the Communist Party last October. His remarks Tuesday signal a potential further strengthening of his grip over the world’s second-biggest economy.

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