China's manufacturing activity expanded at a faster rate in November than it did in October, as companies revved up production and growth in new orders accelerated, official data showed Thursday, Caixin reports.
Beating all expectations of sluggish economy, the Purchasing Managers' Index (PMI) jumped to 58.2 in the month, up from 56.6 in October.
A reading above 50.0 indicates expansion, while a reading below signals contraction.
Production grew at the fastest pace in eights months in November, driven by a further sharp increase in new orders.
"The sector faces increasing headwinds in the months ahead from the anti-pollution crackdown, slower credit growth, reduced fiscal support and a cooling property market", Capital Economics analyst Julian Evans-Pritchard wrote in a research note.
Equipment manufacturing and high-tech manufacturing continued robust growth, with the sub-indices coming in at 52.9 and 53.2 respectively, suggesting improved industrial structure. Of real note was a surge in demand for United Kingdom investment goods, such as plant and machinery, with new orders for these products rising to the greatest extent in over two decades.
"For the most part, the manufacturing sector remained stable in November, although some signs of weakness emerged", said Zhengsheng Zhong, director of macroeconomic analysis at CEBM Group. Cost inflation surged to a 17-month high and output price inflation was the strongest since February.
"That said, manufacturers remain very cautious about the outlook and likely won't invest enough to enable the current period of strong output growth to continue for long".