Country’s Economy Picks Up After Government Stimulus Kicks In
In the past 18 months the factory activity in China have expanded to its fastest pace as new orders have increased thus showing indication that the country’s economy is fast picking up as the government stimulus is kicking in.
Meanwhile the HSBC/Markit flash manufacturing purchasing managers index have increase to 52 percent from June then finished of with a final reading of 50.7 percent. This ws the highest reading since January 2013 and anything above the 50 point level which separates growth in an activity compared to the contraction for the second consecutive month.
Economic activity still continues to improve for the month of July and suggested that the impact of mini stimulus measures that were introduced is filtering through. And policymakers are expected to maintain its accommodating stance in the next few months in hopes to consolidate its recovery. However several analysts state that the recovery is still patchy and might need more stimuli is need to offset the downdraft from the cooling down of the property market in a braider economy along with the increase in risks of the financial system that deteriorated credit quality. The economy is showing signs of recovery and there is no reason for the government to stop taking any actions an financial expert still believe in a creating a favorable fiscal and monetary policies that will be expanded later.
The Chinese cabinet also pledged to boost their support for small companies and in the farming sector in getting commercial and central banks to disburse out more loans. Also a breakdown of factory activity numbers that showed most of the 11 sub indices are measuring out put, domestic and foreign demand to improve substantially thus underlining improving performance for smaller manufacturers.