China's big factories were surprisingly busy in March as a stream of new orders lifted activity to an 11-month high, but credit-constrained smaller manufacturers struggled, suggesting that the economy is still losing steam.
The pickup in production at large factories was attributed to an expected bump as winter ends, and economists cautioned not to read too much into the stronger-than-expected figure.
That left intact a view that China's economy, while not crashing, likely suffered its worst quarter in three years between January and March, and requires at least some monetary policy easing this year to ensure the cool down stays mild.
The pickup in production at large factories was attributed to an expected bump as winter ends, and economists cautioned not to read too much into the stronger-than-expected figure.
That left intact a view that China's economy, while not crashing, likely suffered its worst quarter in three years between January and March, and requires at least some monetary policy easing this year to ensure the cool down stays mild.
Official Chinese PMI, which highlights larger factories, 53.1 in March vs. 51 in February and forecasts of 50.5, marking the fourth straight month of gains. However, HSBC PMI, which measures smaller factories, 48.3 in March (flash reading was 48.1) vs. February's 49.6, marking the fifth successive month of contraction.
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