Top Biz News

Output, orders slow down in Feb

By Li Yanping and Sophie Leung (China Daily)
Updated: 2010-03-02 10:51

BEIJING: China's manufacturing expanded by the least in a year in February as output and orders grew at a slower pace.

The Purchasing Managers' Index fell to a seasonally adjusted 52, according to Li & Fung Ltd, a Hong Kong-based company that releases data for the Federation of Logistics and Purchasing. That was less than 55.8 in January and the median 55.2 estimate in a Bloomberg survey of 15 economists.

The world is counting on China to drive growth as Europe's recovery falters and the US grapples with high unemployment. The Shanghai Composite Index has fallen about 7 percent this year on concern that the Chinese economy may lose momentum as the government reins in stimulus to counter overheating risks.

"We are still in strong expansionary territory, but we believe some of the momentum of the recovery we experienced in 2009 is fading," Stephen Green, an economist at Standard Chartered Plc in Shanghai, said. Last month's Spring Festival holiday may have damped orders, he said.

In Monday's data, a reading over 50 indicates an expansion. An index of export orders fell to 50.3 from 53.2 in January.

China's economic growth accelerated to 10.7 percent, the fastest pace since 2007, in the fourth quarter on stimulus spending, subsidies for consumer purchases and record lending. Increased demand was a factor in Baoshan Iron and Steel Co, China's biggest publicly traded steelmaker, raising prices for March delivery.

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