Chinese factory activity up for 5th straight month

China notched up a fifth straight month of expanding activity across the country’s factories and workshops according to an industry report.

The China Federation of Logistics and Purchasing Managers Index (PMI) rose to 53.3 in April, an increase of .2 over the 53.1 March reading.

A figure above 50 indicates an improvement in overall business conditions and one below 50 signals deterioration.

The increase was driven by an improvement in production, which climbed two points from the previous month to 57.2.

The figures support economists’ forecasts that China’s growth may have bottomed in the first quarter.

“China has thus far avoided the much feared hard landing,” IHS Global Insight economists Alistair Thornton and Xianfang Ren wrote in a note to clients.

“Whilst things do look better it is too early to break out the champagne.”

They said timid monetary easing over the past few months ensured the gentlest of bounce-backs after the recent crunch.

“There are signs of life in the economy and things should improve, all underpinned by an easing credit climate,” Thornton and Xianfang said.

“But the recovery will be slower, more volatile and less assured than perhaps markets were hoping for.”

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