Chinese manufacturing growth further strengthened in February, with the Purchasing Managers' Index (PMI) up 0.5 percentage point from January to 51.0, rising for the third consecutive month, according to the National Bureau of Statistics and the China Federation of Logistics and Purchasing.

The sub-indices for new orders and procurement volume rose, with the former having a reading of 51 and the latter rising three percentage points, indicating an expansion of market demand.

A reading of more than 50 indicates expansion, while a reading below 50 suggests contraction.

The production sub-index, which had been on an uptrend since the beginning of 2012, hit 53.8 in February, the highest since  June last year.

The general equipment production, electrical equipment production, and transportation equipment production sectors recorded production sub-index readings of more than 60. 

The raw material inventory sub-index fell 0.9 percentage point month-on-month to 48.8. The inverse direction taken by the two sub-indices indicate a rebound in industrial production.

The sub-index for new export orders rose 4.2 percentage points from January to 51.1 in February, staying above the 50 mark for the first time since last August, signaling a recovery in China's export markets alongside the U.S. where the manufacturing PMI index had also climbed for three months in a row.

According to the report, the new export orders sub-index traditionally rises after the Spring Festival.

The PMI reading for small and medium-sized enterprises had rebounded since the beginning of the year to 55.2 in February,  ending a eight-month period when the reading was below 50.

The purchasing price sub-index rose four percentage points month-on-month to 54, with the crude oil and coking coal refining,  chemical raw materials and chemical products, and rubber sectors posting readings of more than 60. 

Source:capitalvue.com