China’s production growth accelerated in August

Almaty. August 31. Silkroadnews – China’s production growth unexpectedly accelerated in August, Reuters reported.
“Growth in China’s manufacturing sector unexpectedly accelerated in August, suggesting the world’s second-largest economy is still expanding at a healthy clip despite rising financing costs and a cooling housing market”, the report said.
Reportedly, the PMI index, published on Thursday, rose to 51.7 in August from 51.4 recorded in the previous month, contrary to expectations of economists predicting a marginal slight decline.
At the same time, it is noted the steel sector has grown quite fast since April 2016 due to the government-supported construction boom. The steady rise in prices for manufactured goods largely reflects the higher demand for building materials and the government’s efforts to reduce excess capacity by closing inefficient and environmentally harmful enterprises.
It is reported that demand is so strong that futures prices for steel reinforcing bars used in construction have grown 9% this month and more than 50% in annual terms.
“A separate official reading on China’s services sector showed expansion slowed to 53.4 in August from 54.5 in July, the slowest pace of growth since May 2016, but still comfortably above a reading of 50, which separates growth from contraction”, the publication reads.
As the newspaper notes, China’s leaders count on growth in services and consumption to rebalance the model of economic growth based on investments and exports.
It is noted that a slower growth is observed in real estate and finance, while a noticeable increase has been seen in the areas of information technology, communications and aviation.