After three consecutive months of contraction, China announced Thursday that the factory activities have recovered expansion territory in June which indicates that the world's second-largest economy is on its way to recovery.
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Data collected by the National Bureau of Statistics (NBS) dropped that the purchasing managers' index (PMI) for the Chinese industrial sector rose to 50.2 in June from the previous 49.6 in May. A reading below 50 reflects contraction, while a reading above 50 indicates expansion.
"As the epidemic prevention and control situation in China continues to improve and policies and measures to stabilize the economy take effect at a faster pace, China's overall economic recovery is picking up," said Zhao Qinghe, NBS senior statistician. By June the sub-index for production had stood at 52.8, representing 3.1 percentage points above the previous month, while the sub-index for new orders stood at 50.4, up 2.2 percentage points from May.
"Among the 21 industries surveyed, the number of industries with PMI in expansion zone increased to 13 in June, showing continued improvement in the country's manufacturing sector," he told. The sub-index that measures suppliers' delivery time increased by 7.2 points by June amounting to 51.3, which is viewed as a significant improvement in supply logistics.
In the same month, the production and business expectations sub-index grew to 55.2 demonstrating that enterprises are continuously regaining confidence. Despite this recovery, the Chinese official adverted about market demand remaining weak and some manufacturing companies are grappling with squeezed profit margins.