- OCBC Bank Global Treasury Research
China's manufacturing activity improved in March, easing concerns over health of the world's second biggest economy suggesting ongoing stimulus measures are starting to support growth. China's official manufacturing PMI rose to 50.2 for March, compared with economists' forecast of 49.3, returning to growth for the first time since July. That compares with 49.0 in February, which was the lowest level since 2011. The sub-index measuring new orders surged to 51.4 from 48.6 in February, while the production sub-index also increased to 52.3 from 50.2, the National Bureau of Statistics reported. A similar improvement was seen in the Caixin manufacturing PMI for March, which rose to 49.7 from 48.0 in February, marking the first increase from the previous month in a year. Meanwhile, China's official services PMI rose to 53.8 in March from 52.7 in February.
China's transition from an export-driven economy to a consumption-based model has come at a huge cost to growth. In 2015 the world's second-largest economy grew at 6.9%, the slowest pace in 25 years. To counter slowing growth, China's policy makers have taken a slew of easing measures, including interest rate and reserve requirement ratio cuts from the central bank, the People's Bank of China.
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