Following the recovery of the manufacturing industry, the prosperity of the mainland service industry has also improved significantly
The latest Caixin China General Service Industry Business Activity Index (Services PMI) released in November rose to 53.5, an increase of 2.4 percentage points from October, the highest since May this year, showing the accelerated expansion of service business operations. The Caixin comprehensive output index in November recorded 53.2, a 1.2 percentage point increase from the previous month, the highest level since February 2018.
New order growth rate hits new high for more than a year and a half
The Caixin report believes that both the manufacturing and service industries have performed strongly this month, which has driven economic activity to pick up. Service industry companies generally report that the company plans to expand within the month, new projects are launched, and the overall demand situation has improved. Manufacturing output has also grown significantly, with a growth rate close to the recent record high in October.
The number of new orders of enterprises has further increased significantly, and the growth of new orders in the service industry and manufacturing industry has accelerated significantly. The overall growth rate has reached a record since February 2018. New overseas business volume also continued to grow. The growth rate of new export orders for the service industry rose to a four-month high, and the number of new export orders for the manufacturing industry increased slightly. In addition, with the improvement of demand, the employment index has returned to the level above the rise and dry line, and employment pressure has eased.
However, corporate confidence has not improved significantly. In November, the confidence of enterprises in the production and operation prospects for the next 12 months decreased slightly from October, and continues to be at a historically low level. Although the optimism of the service industry has rebounded, it is still significantly lower than the historical average. It fell to a minimum of five months. Zhong Zhengsheng, chairman and chief economist of Monita Research of Caixin think tank, believes that in November the mainland economy showed a momentum of recovery and domestic and foreign demand improved, but corporate confidence did not significantly improve, reflecting the high degree of uncertainty in Sino-US conflict. The Sino-U.S. Conflict is also a key clue to restricting the stability and recovery of the Mainland economy.
Pig price rises 5% MoM or CPI continues to rise
Wang Tao, head of UBS’s Asian economic research and chief Chinese economist, believes that overall economic activity improved in November, and policy easing increased slightly. Combined with the trend of high-frequency data, it is expected that the overall economic activity in November may slightly improve from the October low. Among them, industrial production, social consumer goods retail, overall fixed asset investment, and import and export growth may accelerate year-on-year, but real estate sales may Slow down. The average pig price in November is likely to increase by another 5% from October, pushing the CPI higher. There were no new local government bond issuances in November, but overall credit growth may have stabilized.