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China Economy Stabilizing

China Economy StabilizingChina Economy Stabilizing

With a preliminary reading of the manufacturing industry scrapped this month by Markit Economics and Caixin Media, analysts must search a bit harder for the pulse of the world’s second-largest economy. Early signs suggest stabilization.

Domestically compiled gauges of manufacturing and services improved in October, while an index based on search engine data for small and medium-sized businesses weakened slightly. They come ahead of official Purchasing Managers’ Indexes for manufacturing and services, both due Sunday, Bloomberg reported.

The People’s Bank of China cut interest rates for the sixth time in a year last week amid mounting challenges to the government’s growth target of about 7% for 2015.

The unofficial purchasing managers indexes jointly compiled by China Minsheng Banking Corp. and the China Academy of New Supply-side Economics showed a much sharper slowdown in the summer and a faster pickup since then.

The manufacturing reading rose to 43.3 this month from 43 in September, while the non-manufacturing measure climbed to 44.2 from 42.3. PMI readings below 50 signal contraction. Jia Kang, director of the Beijing-based academy and former head of the finance ministry’s research institute, expects more attention will shift to the Minxin gauge after Caixin stopped publishing its flash PMI.

Financialtribune.com