China’s factory growth falls short of expectations as experts decry insufficient stimulus measures

China’s factory activity growth in November fell short of analysts’ expectations on Tuesday, indicating that Beijing’s stimulus measures were not enough to significantly boost the country’s ailing economy.

The country’s official purchasing managers index for December reached 50.1, data published by the Data from the National Statistics Office presented.

The reading missed Reuters expectations of 50.3. Manufacturing activity was 50.3 in November and 50.1 in October. A PMI reading above 50 indicates expansion in activity, while a figure below indicates contraction.

Investors will also be keeping an eye on the Caixin/S&P Global Manufacturing Purchasing Managers’ Index, which is scheduled for release on Thursday.

“For the Chinese economy, 2024 will be remembered as a year of turning out,” said Larry Hu, chief China economist at Macquarie Group.

“Deflationary pressures have persisted, as stimulus policies are sufficient to achieve the GDP target, but far from sufficient to reflate the economy,” he added.

China’s economy has shown some recovery following a series of stimulus measures introduced since end of september.

However, other recent economic data from China indicates that the world’s second-largest economy is still mired in disinflation, largely due to tepid consumer demand and a prolonged slowdown in the property market.

China’s consumer inflation fell to its lowest level in five months in November, while the country’s export and import figures not meeting expectations. Furthermore, the latest Retail sales data also disappointed.failing to meet Reuters forecasts.

China’s industrial benefits They extended the declines for the fourth consecutive month, falling 7.3% in November compared to the previous year.

Last week, China’s Ministry of Finance announced would increase fiscal support next year to help boost consumption by expanding consumer goods exchanges, increase pensions and health insurance subsidies for residents.

The Chinese authorities have also decided issue 3 trillion yuan (411 billion US dollars) in special treasury bonds next year (the largest amount on record) to step up fiscal stimulus efforts, according to Reuters.

China will face greater challenges with Donald Trump in the White House. Trump’s threat to impose higher tariffs on Chinese products could further affect China’s export sector, which is already facing increased trade barriers from the European Union.