manqiangrexue
Brigadier
12-Oct-2020 Intellasia | The Telegraph | 6:02 AM
China’s economy got another boost in September as the services industry recorded its fifth consecutive month of strong growth.
Output and new orders are rising steadily, allowing employers to ramp up hiring according to the Caixin purchasing managers’ index (PMI) survey from IHS Markit. It marks a steady return to growth after six months of falling employment
Domestic demand is leading the recovery, with international orders still subdued as the world’s second-largest economy outpaces those countries that are still suffering from the coronavirus pandemic.
The PMI score rose to 54.8, the highest level in three months. Any number of above 50 indicates growth compared to the previous month.
Markets reopened after the eight-day Golden Week holiday, celebrating the expansion with China’s currency jumping by the most in more than four years.
Shares on the Shanghai Composite index rose 1.7pc on the stronger numbers.
Economists said it all added to growing signs of steady recovery.
“Goods sales were stronger than consumer services. The virus containment provided the basic public health conditions for holiday activities. Household purchasing power recovered steadily. And consumer confidence also came back on overall economic recovery,” said Xiangrong Yu at Citi.
“Looking ahead, the solid Golden Week sales bode well for a low single-digit growth of retail sales in the fourth quarter, after turning positive in August.”
Analysts at ING said the Chinese government’s plans to boost the economy through “internal circulation” of domestic spending appears to be working.
“The source of growth for internal circulation is domestic demand from domestic consumption, new-infra and traditional infrastructure investment. Policies are planned to boost internal circulation,” said Iris Pang.
“The idea is that this source of growth will drive the job market and with more people returning to work following redundancies due to Covid-19, they will spend more and drive growth faster.”
Domestic travel in particular appears to be generating service sector jobs, while retail sales are also rising.
Car sales boom in China as economic recovery continues
Lizzy Burden Tue, October 13, 2020, 6:37 AM EDT
China’s car sales enjoyed a “golden September” as its .
The world’s largest vehicle market and second-biggest economy saw automobile sales climb 12.8pc last month to 2.6m, according to data from the China Association of Automobile Manufacturers – marking the sixth straight month of growth.
The figures underline the differing economic fortunes between the country where the coronavirus outbreak began and the rest of the world.
Customs data also released on Tuesday showed that Chinese goods exports rose 9.9pc in September compared with the same month last year - slightly higher than the 9.5pc increase in August. This brought annual export growth for the third quarter to 8.8pc, compared to just 0.1pc in the second quarter.
Chinese trade was boosted partly because the country is benefitting from its trading partners remaining stuck in lockdown. In contrast it has reported just one locally transmitted Covid infection in almost two months.
Strong demand for medical personal protective equipment such as face masks lifted shipments of textile material 34.7pc year-on-year in September, for example.
In addition, exports of laptops and computers grew 45pc year-on-year last month as more people worked from home. Imports to China, too, rose – a sign that domestic demand is finding its feet.
They surged 13.2pc last month to their best levels this year, with volumes especially high for soybeans, grains, semiconductors, copper and steel products.
The rise in imports was helped by government support measures and an appreciation of the yuan, which rose to a 17-month high against the dollar on Friday.
"We expect goods imports growth to remain firm in the near term, underpinned by strong domestic demand,” said Tommy Wu at Oxford Economics.
Renewed outbreaks of the virus in China’s export markets will remain a challenge, especially over the winter months but Mr Wu was confident that “shipments of products benefiting from virus-related demand such as work-related electronic products and personal protection equipment should continue to hold up”.
Overall, the . The official purchasing managers’ index for new manufacturing export orders tipped over the 50 mark that separates contraction from growth to 50.8 in September.
“The September PMI readings suggest that the domestic recovery has gained pace, which should support a further expansion in imports in the near term,” Oxford Economics said.
