The Chinese economy has spread its wings! Experts are confident that it will now gain momentum. According to current estimates, in August, manufacturing activity in China grew at the fastest rate in five months. This provides hope for an improvement in the current situation.
Against this backdrop, the RatingDog General Manufacturing PMI rose to 50.5 points from 49.5 points in July. This figure surpassed the forecast of 49.7 points and exceeded the 50-point threshold that signals growth.
Such a strong surge was driven by a significant increase in new orders. However, export demand declined for the fifth consecutive month.
“The latest upturn resembled a breath of relief rather than a sustained rally,” Yao Yu, founder of RatingDog, said in the statement. “With weak domestic demand, potentially overstretched external orders, and slow profit recovery, the durability of the improvement depends on whether exports truly stabilize and whether domestic demand can pick up pace.”
Despite the current upswing, manufacturers remain cautious about hiring, even though employment has been falling for five consecutive months. "Notably, the manufacturing sector is helping the recovery, but this rebound is patchy," added Yao Yu.
Positive changes are supporting cautious optimism in the manufacturing sector, but a "fly in the ointment" remains. These are rising costs for oil and gas caused by a sharp increase in raw material prices and ongoing delays among some suppliers.
