China’s economy is stabilising after the slowdown of recent months, data suggest, easing worries about a hard landing but raising questions about the government’s commitment to rebalancing.
A slump in manufacturing and property, China’s traditional growth drivers, has slammed global commodity prices and shrunk profits at Chinese groups tied to the old growth model. Planned lay-offs in steel, coal and other overcapacity sectors have led to labour unrest and concern over unemployment.
However, recent data suggest the tide is turning, at least temporarily. The Caixin purchasing managers’ indices for both manufacturing and services rose sharply in March. The manufacturing PMI hit 49.7 in March, its highest level in more than a year and a much better reading than expected. Caixin’s services PMI rose to 52.2 in March from 51.2 in February. The 50-point level separates contraction from expansion.
The latest figures suggest recent stimulus efforts — notably in the property sector — have succeeded in arresting the slowdown.
But stimulus for property risks worsening the economy’s reliance on fixed-asset investment, hindering a transition to consumption- and services-led growth pursued by policymakers. Caixin noted on Wednesday that property was “the main factor driving the recent rebound in investment”.
Property was also the main driver of strong growth in the FTCR Business Activity Index, a newly launched gauge of activity in real estate, exports and logistics from FT Confidential Research. That index rose to 57.9 in March from 50.6 in February, its highest reading since October 2014, even as exports and logistics remained week.
“We expect the uptick in real estate sales to begin feeding through into stronger construction activity in coming months, helping to drive a more broad-based recovery,” FT Confidential wrote.
FTCR商业活动指数(FTCR Business Activity Index)的飙升也是主要由房地产业贡献的。这个由英国《金融时报》旗下的《投资参考》(FT Confidential Research)不久前推出的指数，衡量的是房地产、出口和物流行业的活动。尽管出口和物流行业依然疲软，该指数却从2月份的50.6升至3月份的57.9，达到2014年10月以来的最高水平。