“China’s manufacturing expanded at the slowest pace in nine months in May as the government extended a campaign to cool inflation and the property market, a survey of companies indicated.
The Purchasing Managers’ Index was at 52 from 52.9 in April, the China Federation of Logistics and Purchasing said in an e-mailed statement. The number was higher than the median forecast of 51.6 in a Bloomberg News survey of 16 economists. The index has a seasonal pattern of falling in May, economists said before the release.
Premier Wen Jiabao has yet to tame prices in the fastest-growing major economy as food and housing costs climb, McDonald’s Corp. charges more for soft drinks, and a drought in Yangtze River areas threatens grain production. Today’s data suggested moderating economic growth may aid his campaign, with input-price inflation easing as manufacturers’ orders and output grew at a slower pace.
“The data suggests continued moderation in industrial activities,” said Li Wei, a Shanghai-based economist at Standard Chartered Bank. At the same time, the reading was strong enough to alleviate “fears of a sharp slowdown, and thus marginally increases the chance of a further rate hike in the near term,” Li said.”
If you enjoy the content at iBankCoin, please follow us on Twitter
