China: Data and growth situation

The manufacturing indicator in China fell in February due to the impact of the new year holiday. (Tera Yatırım)

The manufacturing indicator in China fell in February due to the impact of the new year holiday. The official manufacturing purchasing managers index (PMI) announced by China's National Bureau of Statistics reached a 9-month low of 50.6. Economists expected the country index to be 51 in February. The index was recorded as 51.3 in January. The private survey released today also showed that China's manufacturing activity was growing at a slower rate in February, with the Caixin / Markit manufacturing PMI coming in at 50.9.


The decrease in activity in the manufacturing sector is largely attributed to the decrease in production caused by the holidays for the Lunar New Year. Despite the decline in activity, the Chinese economy, which has grown ahead of all major regions, continues to remain in a growth position. Whereas; The growth in the manufacturing sector is at the slowest level in the last 9 months.


The non-manufacturing indicator, reflecting activity in the construction and service sectors, fell to 51.4, instead of the average 52 estimate. The composite index fell to 51.6 in February, the lowest level since the virus lockout a year ago. Virus restrictions imposed in some parts of the country to limit outbreaks have caused travel restrictions, in particular. However; retail, catering and entertainment services continue to remain relatively active.


Although China's industrial productivity had seen a serious drop due to the lockdown implemented in the first and second quarter of last year; GDP grew by 6.5% in 4Q20, after that lockdown period. In 2020, the economy grew by 2.3%, as well. In addition to the rapid return to industrial productivity, China has also taken various incentive measures, such as the issuance of special treasury bills, lower lending rates and tax exemptions. China, which has always been criticized for being anti-democratic and whose economic data is not trusted normally, managed to get out of the epidemic effects at an early stage, with the Communist Party's strict implementation of quarantine measures, especially in Beijing and other big cities. The growth target is naturally not implemented for 2020 due to Covid-19.


Kaynak: Tera Yatırım
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