Asia manufacturing increases, analysts warning of headwinds
HONG KONG / BRUSSELS - Agence France-Presse
Indonesian workers at L’Oreal’s world largest factory in Jababeka Industrial Estate, Cikarang, West Java, Indonesia. EPA photoFactory activity across Asia broadly picked up in November, with China adding to the improvement seen in the previous month, as hopes rise that the region is beginning to rebound from its recent slumber.
The latest batch of purchasing managers’ indexes from HSBC show manufacturing activity in China hit a 13-month high, while India also saw its strongest expansion since June.
The news comes despite the debt crisis in Europe, a key market for many of Asia’s exporter nations, which has seen demand slump, while analysts also warned of the impact if U.S. lawmakers do not agree a deal to avert the fiscal cliff.
China’s PMI hit 50.5 last month, the British banking giant said, up from 49.5 in October and putting it above the 50 mark that indicates growth. A reading below signals contraction.
The figure signals a return to growth after 12 consecutive months of contraction as the crucial manufacturing sector has been hit by a global slowdown as well as the eurozone crisis.
It is the highest reading since October last year, when the figure was 51, according to HSBC.
The figures come after the official PMI reading showed expansion in November for the second month in a row, hitting 50.6, compared with 50.2 in October and 49.8 in September.
Economic growth hit a more than three-year low of 7.4 percent in the third quarter from July to September but recent data have fuelled optimism that the worst is over.
Exports, industrial production, retail sales and fixed asset investment -- a key gauge of infrastructure spending -- have all shown improvement.
There was some cheer for India, which continues to struggle with a debilitating slowdown, with HSBC’s PMI climbing to a seven-month high of 53.7 in November, from 52.9 in the previous month.
South Korean manufacturing contracted in November for a sixth straight month but the pace of decline slowed, HSBC said, with the PMI at a five-month-high 48.2 versus 47.4 in October. Adding to the sense of improvement was news Saturday of a jump in export growth. Elsewhere, Indonesia’s PMI came in at 51.5 in November, slightly below October’s 51.9 but still marking growth, while Vietnam climbed to 50.5 -- its highest its highest in 14 months -- from 48.7.