Given that economists hardly expect anything bad ever, this headline is hardly shocking: China’s Factory Activity Shrinks for an Unexpected Third Month.
Activity in China’s manufacturing sector unexpectedly shrank for a third straight month in October, an official survey showed on Sunday, fueling fears that the economy may be cooling further in the fourth quarter despite a raft of stimulus measures.
The official Purchasing Managers’ Index (PMI) was at 49.8 in October, the same pace as in previous month and lagging market expectations of 50.0.
To shore up growth, the government has cut interest rates six times since November and lowered the amount of cash that banks must hold as reserves four times this year. The latest cut in interest rates and banks’ reserve requirement came in late October.
Beijing has also ramped up infrastructure spending and eased restrictions on home purchases to revive the flagging property market.
Gee. Who Coulda Thunk?
Mike “Mish” Shedlock