(Bloomberg) — China’s factory activity expanded for a third straight month in December, bolstering expectations the economy will reach its annual growth target after Beijing’s stimulus blitz.
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The official manufacturing purchasing managers’ index was 50.1, the National Bureau of Statistics said Tuesday. While it indicates a slightly slower pace of growth than economists expected, the reading marked the longest streak of expansion since March last year.
The non-manufacturing measure of activity in services and construction was 52.2, significantly above the forecast of 50.2 and rising to the highest level since March. The 50-mark separates expansion and contraction.
“Corporate production and operation activities accelerated in December, and the economy’s momentum extended a trend of rebounding and improving,” NBS senior statistician Zhao Qinghe said in a statement accompanying the data.
The world’s No. 2 economy has been showing tentative signs of recovery after authorities announced a raft of stimulus measures including interest-rate cuts in late September. But sluggish consumption remains a pain point just as exports — one of China’s main growth drivers — faces the threat of a new trade war from the incoming Trump administration.
In an effort to repair the economy’s weak link, Chinese policymakers earlier this month elevated boosting consumption and domestic demand the top priority for economic work next year, only the second time in at least a decade. They listed a few areas of focus including helping lower-income groups and improving the social safety net, although Chinese leaders have yet to provide details of their plans.
Services activity expanded at the fastest pace since March, reflecting a broad recovery in momentum from transportation to financial services, according to the NBS.
New orders for the construction industry expanded for the first time this year, reflecting increased activity as companies rushed to build projects ahead of the Lunar New Year holiday, according to the NBS.
(Updates with more details throughout.)
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