China’s manufacturing PMI falls to three-year low

BEIJING — China’s manufacturing conditions slipped to the weakest level in more than three years, despite stimulus measures to bolster the world’s No 2 economy, as sluggishness in the nation’s old growth drivers add to risks facing the government’s growth target.

The official purchasing managers index (PMI) slipped for the fourth straight month, falling to 49.6 in November from 49.8 the previous month, the National Bureau of Statistics said yesterday — the lowest level since August 2012.

Services, which have helped offset the weakness in manufacturing, showed some improvement. The official measure covering China’s service industries rose to 53.6 from 53.1. Numbers below 50 indicate deterioration.

The latest data highlight the two-speed nature of China’s economy as officials try to shift the economy’s focus from manufacturing to services in a transition that is proving to be rocky. Growth in the latest quarter fell to a six-year low of 6.9 per cent, slightly down from 7 per cent in each of the two preceding quarters after repeated interest-rate cuts and other stimulus measures.

Another manufacturing PMI released by Caixin Media and Markit Economics edged up to 48.6 in November, over the median estimate of 48.3.

The official index, compiled by the Chinese Federation for Logistics and Purchasing, includes more of the country’s larger, state-owned enterprises, while the Caixin survey is weighted to smaller, private enterprises in China’s manufacturing industry, which employs millions.

ANZ Bank economists Liu Li Gang and Louis Lam said the official manufacturing index was consistent with other data released last month that showed factory output weakening and reinforced the need for Beijing to roll out further stimulus measures.

“With soft growth momentum and deflation pressures creeping up, we expect the authorities to further ease monetary policy and continue to implement an expansionary fiscal policy in order to prevent further slowdown of the economy in 2016,’’ they said in a report. Agencies