HSBC manufacturing PMI sluggish in April

By Zheng Yangpeng (China Daily) Updated: 2014-05-06 11:00

But the new export orders index was a sign that export conditions in April were probably weak. Official trade figures for the month won't be released until Thursday, but Ministry of Commerce officials have repeatedly cautioned that the data could be disappointing. The government has introduced measures to stabilize the export sector.

Beyond exports, the State Council (the cabinet) in March outlined a package of spending on railways and subsidized housing and tax cuts to support growth. To stabilize investment, which is crucial for China's economy, China Railway Corp plans

HSBC manufacturing PMI sluggish in April

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to increase this year's investment to more than 800 billion yuan ($128 billion) from a previously announced 720 billion yuan, business publication Caixin reported last week. The amount had already been raised twice this year from an original 630 billion yuan to 700 billion yuan and then to 720 billion yuan.

"Beijing has introduced more reform measures that could support growth by inducing more private-sector investment," Qu said. "We think bolder actions will be required to ensure the economy regains its momentum."

While most analysts believe the manufacturing sector is unlikely to see an upturn in the short term because of high inventory levels, the services industry fared a little better last month, according to the official PMI.

The PMI for the services industry rose to 54.8 in April from 54.5 in March, the NBS said over the weekend.

The output of tertiary industry, mostly services, generated 46.1 percent of China's GDP last year, rising to 49 percent in the first quarter of this year.

"I think many China observers missed the structural change; that is, the rise of the service industry," said Fan Jianping, chief economist of the State Information Center, a government think tank.

"This is why many analysts underestimated China's GDP growth in the first quarter as they just focused on industrial output. This is also why employment remains stable so far despite a slowdown in manufacturing, because the service sector is far better at creating jobs."