China's Non-Manufacturing Sector Grows In March

Category: World / Apr 03, 2013 3:44PM EDT
China's non-manufacturing sector grew in March, with the index for construction business activity reaching a one-year high. The purchasing managers index (PMI) for the non-manufacturing sector stood at 55.6 percent in March, up 1.1 percentage points from the previous month, the National Bureau of Statistics (NBS) said Wednesday in an online statement. A PMI reading above 50 percent indicates expansion, while a reading below 50 percent indicates contraction. The sub-index for intermediate input prices lost 0.9 percentage points to 55.3 percent, while the price of building materials including steels and cement declined from the previous month. "The growth in business activity and orders indicates strong growth momentum," said Cai Jin, vice chairman of the China Federation of Logistics and Purchasing (CFLP). "On one hand, it can lower the cost for enterprises; on the other hand, it is good factor that the decrease of the charge will directly alleviate the pressure of inflation." The sub-index for construction business activity stood at 62.5 percent, setting a new high since last March and indicating a strong rebound in the sector, according to Cai. Meanwhile, the sub-index for real estate rose 9.8 percent from the previous month to 58.6 percent. However, the index is about to drop back in April, meaning real estate companies are prudent to future market. "The main reason for the dropping is the real estate control measures. After that, real estate enterprises will have expectation. But we estimate that the trend for future real estate market is steady," added Cai. The non-manufacturing PMI is based on a survey of about 1,200 companies in 27 industries, including transportation, real estate, catering and software development. (Video Source: REUTERS)