China’s Economic Activity Shows Continued Expansion in August, Driven by Manufacturing and Services
Recent data indicates continued expansion of economic activity in China during August, as reflected in the latest Purchasing Managers’ Index (PMI) figures. The overall PMI output index remained in expansionary territory, signaling an acceleration in the pace of production and operation for Chinese enterprises.
Manufacturing activity demonstrated positive momentum. The manufacturing PMI registered at 50.4%, a 0.4 percentage point increase from July.This growth is partially attributed to the positive effects of policies aimed at improving market competition, specifically addressing “intra-roll” competition. Continued optimization of these policies is expected to alleviate supply and demand imbalances and contribute to price stability. High-tech manufacturing and equipment manufacturing PMIs showed particularly strong performance, reaching 51.9% and 50.5% respectively – increases of 1.3 and 0.2 percentage points from the previous month, reinforcing their roles as key drivers of growth.
Market expectations also improved. The index of production and operation expectations rose to 53.7%, up 1.1 percentage points, marking a two-month consecutive rebound. Industries like general equipment,railway,ship,aerospace equipment,and others reported expectation indices above 58.0%, indicating strong confidence in future industry growth.
Non-manufacturing sectors also continued to expand. The non-manufacturing business activity index reached 50.3%, while the new order index increased by 0.9 percentage points to 46.6%. This steady supply and demand dynamic contributed to price stability, with the input price index remaining unchanged and the sales price index rising slightly by 0.7 percentage points to 48.6%.
The service industry experienced a notable rebound in prosperity. The service industry business activity index rose to 50.5%,a 0.5 percentage point increase and the highest level recorded this year. Several service sectors, including capital market services, railway transportation, air transportation, telecommunications, and satellite transmission, all reported business activity indices exceeding 60.0%.Capital market services, in particular, maintained an index above 70.0% for two consecutive months, demonstrating rapid growth.
However, the construction industry faced headwinds. High temperatures and rainfall impacted construction activity, leading to a decline in the business activity index to 49.1%, down 1.5 percentage points.Despite this, market expectations for the construction sector remained slightly positive, with the business activity expectations index at 51.7%, a marginal increase of 0.1 percentage point from the previous month.
Experts anticipate that continued policy effectiveness will unlock further domestic demand, driving improvements across related industries. Zhao qinghe noted that the manufacturing production index (50.8%) and non-manufacturing business activity index (50.3%) both contributed to the accelerated overall expansion of production and operation activities within Chinese enterprises.
(source: Based on data and statements attributed to Zhao Qinghe, as reported in the provided text.)
Editors: Liang Weiya, Cai Jiayuan
Reviewer: Yang Xiangming
