China’s economic recovery slows

2 March, 2021 12:00 AM printer

BEIJING: China’s economic recovery slowed in February as factories shut during the Chinese New Year holidays and virus restrictions dampened what’s usually a busy travel season.

The official manufacturing purchasing managers’ index (PMI) fell to a nine-month low of 50.6, from 51.3 in January, as export orders plunged, the National Bureau of Statistics said on Sunday. That was lower than the median estimate of 51 in a Bloomberg survey of economists, report agencies.

The non-manufacturing gauge, which reflects activity in the construction and services sectors, declined to 51.4, versus a median estimate of 52. The composite index dropped to 51.6 in February, the lowest since the virus lockdown a year ago.

Manufacturing activity is usually distorted by the week-long Chinese New Year holidays - which fell in February this year - when factories and businesses close and many people travel back to their hometowns for family gatherings.

This year, however, virus restrictions to contain outbreaks in some parts of the country prompted workers to cut back on travel and spend instead at shops, restaurants and cinemas close to their job locations.

The statistics bureau said holiday closures were the main reason for the slump in manufacturing, while retailing, catering and entertainment remained relatively active.

Despite the seasonal slump in activity, the PMIs remain above the 50-mark, indicating output is still expanding, but at a slower pace. A set of early economic indicators tracked by Bloomberg also showed the recovery continued into February.