China's manufacturing sector returns to growth in September
What's the story
China's manufacturing sector has shown signs of recovery in September, according to an official survey. The manufacturing purchasing managers' index (PMI) rose to 50.1 from August's 49.8, marking a return to growth after two months of contraction. The improvement is largely attributed to easing weather disruptions and the global artificial intelligence boom supporting the industrial sector.
Growth indicators
Improvement in demand and output
The sub-index for new orders stood at 50.5, while the production sub-index was at 51.7 in September.
These figures indicate an improvement in both demand and output within China's manufacturing sector.
The official data closely matched a stronger private-sector reading from RatingDog, which reported a rise in its manufacturing PMI to 52.1 from August's 50.5 and an increase in services PMI to 51.6 from August's 51.4.
Economic challenges
Pressure on policymakers to roll out support measures
Despite the positive signs in manufacturing, a string of soft economic readings has increased pressure on policymakers to roll out further support measures.
Retail sales and investment remain weak, prompting China to announce new measures aimed at channeling cheaper credit into sectors such as infrastructure and technology.
The country is also expanding support for home buyers amid a prolonged property downturn.
Services sector
Services sector shows improvement
The non-manufacturing PMI, which covers services and construction, improved to 50.2 in September from August's 49.0.
This data shows an improvement in China's services sector for the month of September.
The country has heavily relied on exports and industrial production to drive growth this year amid weak domestic demand and a prolonged property downturn affecting household and business confidence.