Chinese manufacturing growth accelerates in December

(Sharecast News) - Growth in China's manufacturing sector unexpectedly picked up in December, according to the Caixin Global purchasing managers' index (PMI) released on Tuesday. The manufacturing PMI rose to 50.8 from 50.7 in November, ahead of the consensus estimate pointing to a slowdown to 50.4.

While growth remains marginal - with any figure above the key 50-point level indicating an expansion in economic activity - this was the fourth positive reading in the past five months.

The improvement was partly due to a stronger rise in new orders during December, rising at their fastest rate since February 2023. "Companies often mentioned that improved market conditions and greater client spending had supported the latest rise in new work," Caixin said in its release.

Meanwhile, new export business fell at the softest rate in six months.



However, Caixin said that manufacturers still maintained a "cautious approach" to staffing levels, with employment across the sector falling for the fourth straight month, and at its quickest rate since May 2023.

"Firms often mentioned that they had opted not to replace voluntary leavers or trimmed headcounts as demand was more subdued than expected. Moreover, companies indicated that capacity pressures eased in December, with backlogs of work falling for the first time in seven months."