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China March PMI: Factories now oppose the economic downturn



The country's massive manufacturing industry unexpectedly recovered in March, government data showed on Sunday. The official index of purchasing managers for the month jumped to 50.5 from 49.2 in February. The index above 50 shows growth over the previous month. A separate study of production activity by the Caixin media group and the Markit research firm published on Monday was also unexpectedly positive.

Goods produced in Chinese factories are shipped around the world and their demand is often seen as a barometer for the health of the world economy.

At the end of last year, the growth of the Chinese manufacturing sector has turned back and economists surveyed by Refinitiv predicted that this trend will continue.

  Asian stock markets climbed on Monday, boosted by better-than-expected recovery in China's manufacturing sector and optimism for US-China trade talks.
  How bad is the economic downturn in China? It is impossible to say

The stimulus begins to bear fruit

China's growth has lost momentum after the government's efforts to cope with risky lending, of the necessary funds for enlargement.

The world's second largest economy has also begun to feel the effects of the trade war with the United States, which has led to new tariffs of about 250 billion dollars in Chinese exports.

The Chinese government last month projected economic growth between 6% and 6.5% in 2019. This is below last year's 6.6% expansion, which is already the slowest annual growth rate in China over the last three decades.
Beijing responded to trillion dollars of new measures designed to stimulate the economy. including business tax relief, infrastructure spending and a more liberal monetary policy.
  China reduces taxes as it warns of a heavy struggle. forward
Some analysts say the latest economic data shows that China's economy is now down, and growth is likely to continue to grow in the coming months when the effects of stimulus measures are felt.

But others warned that it is still too early to say whether China's economic picture is improving. "We still believe that growth may weaken again in the near future," said Julian Evans-Pritchard, senior economist at the research firm Capital Economics.


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