ALBAWABA — China's factory activity expanded in January for the first time in four months, the National Bureau of Statistics reported on Tuesday.
The economy rebounded sharply since the nation recovered quickly from a surge in Covid infections, leaving the official manufacturing purchasing managers' index this month to rise to 50.1 on a 100-point scale on which numbers above 50 show activity growing, from 47.0 in December, according to data from the National Bureau of Statistics.
The non-manufacturing PMI, which includes the services and construction sector, stood at 54.4 in January, up from 41.6 in December.
The subindex measuring factory production increased to 49.8 from 44.6 in December, while total new orders rose to 50.9 from December’s 43.9. The subindex of new export orders rose to 46.1 in January from 44.2 in December.
The subindex measuring services activity jumped to 54.0 in January from December’s 39.4, while the subindex measuring construction rose to 56.4 from 54.4 in December.
China ending its three-year-long zero-Covid policy in early December, catching the public off guard which lead to a rapid spread of infections that were squashed quickly.
Weakened Chinese consumer demand in part due to COVID-19 outbreaks and a downturn in the real estate industry, coupled with tepid demand from the United States and the Eurozone member states after their central banks raised interest rates to fight inflation deflated manufacturing output.
New orders, new export orders, factory activity and employment improved in January, the NBS and the China Federation of Logistics and Purchasing reported.
“The official PMIs add to evidence of a rapid rebound in economic activity this month as disruption from the reopening wave faded,” Sheana Yue, China economist at Capital Economics, told Bloomberg.
“With zero-Covid in the rear-view mirror, the recovery should remain robust in the near-term,” Yue added.
Last year the economy grew a mere 3 three percent, its slowest pace in four decades excluding pandemic-hit 2020, as Covid restrictions and a crisis in the property market hampered growth.
Analysts from Nomura, a Japanese financial holding company, in a research report, predict that both the manufacturing and non-manufacturing PMIs will rise further in February, saying that manufacturing activity will see a further boost following the Lunar New Year holiday, as more people adapt to living with Covid.
