China Factory Activity Grows but Power Shortage, Rising Costs Hamper Production -Breaking
By Gina Lee
Investing.com – Chinese factory activity in October, according to a business survey. While stronger demand was a contributing factor to growth, rising costs and power shortages hampered production.
It was 50.6. This is higher than the 50 figure in the forecasts by Investing.com for the month. This index reached its highest level since June 2021, surpassing the 50 mark that indicates growth.
The National Bureau of Statistics released data on Sunday showing that both the PMIs and the were lower than expected at 49.2 and 52.4 in October.
However, growth in China’s manufacturing sector has slowed down thanks to COVID-19 outbreaks, higher costs, supply-chain bottlenecks, and power rationing. Due to the lack of coal, stricter emission standards and strong industrial demand, rationing led to an increase in power shortages, which further impacted factory output.
The manufacturing sector saw a slight improvement in October compared to the prior month. Wang Zhe from Caixin Insight Group, a senior economist, said that downward pressure continued on economic growth.
The main determinant of the economy’s health was supply strains. Manufacturers were faced with severe challenges due to a lack of raw materials as well as soaring commodity costs.
China’s cabinet announced on Wednesday, that it will delay some taxes for some manufacturers until November 2021 in order to give some relief.
Wang warns that China’s latest COVID-19 epidemic since October 2021 may also cause economic instability. He stated that it was crucial to strike a balance between the two goals of controlling outbreaks and maintaining economic activity.
The next scheduled release is Wednesday
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