The
official purchasing managers' index (PMI) is expected to have
held at 50.2 in October, in line with last month's reading,
according to the median forecast of 32 economists in a Reuters
poll.
The highest projection was a reading of 50.5 by Capital
Economics and the lowest 49.9 by Standard Chartered. An index
reading above 50 indicates expansion in activity on a monthly
basis while below that signals contraction.
Policymakers since June have rolled out a slew of support
measures including modest interest rate cuts, increased cash
injections, and more recently, stronger fiscal stimulus. But
analysts say this may not be enough for the government to hit
its annual growth target of around 5%.
The world's second-largest economy grew faster than expected in
the third quarter, while consumption and industrial activity in
September also surprised on the upside.
Nomura, JPMorgan and Moody's Analytics all upgraded their 2023
growth outlook, following the third quarter data to 5.1%, 5.2%
and 5%, respectively.
Despite indicators suggesting the economy is stabilizing, the
government continues to wrestle with a domestic property crisis,
high youth unemployment, depressed private sector confidence and
a slowdown in global growth.
China's top parliamentary body last week approved a 1 trillion
yuan ($137 billion) sovereign bond issue in the fourth quarter,
and passed a bill allowing local governments to front load part
of their 2024 bond quotas to support investment and economic
growth.
Earlier this month, the central bank injected into the economy
the biggest cash support since late 2020 via short-term policy
loans to allow banks to extend credit and keep interests low.
The PMI, which largely focuses on big and state-owned firms,
will be released on Tuesday.
(Reporting by Joe Cash; Polling by Devayani Sathyan and Susobhan
Sarkar in Bengaluru and Jing Wang in Shanghai; Editing by Sam
Holmes)
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