Share

China manufacturing hits two-year high, boosted by heavy industry

The level of manufacturing in China reached a two-year high last month as the nation’s once dominant heavy industries came back to life amid strong investment in infrastructure and property.

The official manufacturing purchase manager index rose by 0.5 percentage points to 51.7, the National Bureau of Statistics said on Thursday. The gauge has stayed in the expansionary territory for four months in a row.

China’s economy roars back … but it’s ‘smokestack’ industries and debt that’s driving growth

It was driven up by rising orders, which rose by 0.4 percentage points to 53.2. The production index has risen for four months, reaching 53.9 in November.

“It’s stronger than expected and the economy is in good shape,” said Julian Evans-Pritchard, a China economist at Capital Economics.

“Large firms did well on government led infrastructure projects. The commodity price rally also helped increase production in the metal sector,” he said.

Profits in China’s industrial sector rise, but growth skewed towards polluting heavy industries

However, signs of weakness can be seen in construction.

A subindex covering the sector has fallen for two straight months, reflecting curbs introduced in October to cool the nation’s property market.