BEIJING, Nov 1 (Reuters) - China’s giant manufacturing sector grew at its fastest rate in seven months in October, buoyed by new export orders, a private survey showed on Friday, adding to signs that the economy is stabilising in the run up to a key government meeting on economic reform.
The final HSBC/Markit Purchasing Managers’ Index (PMI) came in at 50.9, up from 50.2 in September and unchanged from a preliminary flash estimate released last week.
A reading above 50 indicates expansion, while a figure below this indicates a contraction.
China’s official PMI released earlier in the day put manufacturing growth at 51.4, the highest in 18 months.
The official PMI is weighted more towards bigger and state owned enterprises and tends to produce more favourable results than the private survey, which focuses more on smaller and private sector firms
The HSBC survey showed a surprise jump in new export orders to 51.3, up from the initial reading of 50.8. Many of the surveyed firms reported stronger demand from the United States in particular.
Domestic new orders also grew at their fastest pace since March, though they were down slightly on the number reported in the flash estimate.
Signs that the economy is doing well will help the government push its agenda for restructuring it towards one driven more by consumer demand than investment and credit at the upcoming Communist Party’s third plenary meeting from Nov. 9 to Nov. 12.
In the first nine months of the year, the $8.5 trillion economy grew 7.7 percent from a year earlier, putting it on track to achieve Beijing’s 2013 target of 7.5 percent, although that would be the weakest growth rate in 23 years.
Economists in a recent Reuters poll saw China’s economy growing at 7.5 percent in the fourth quarter from 7.8 percent in the third.