China’s Oct Preliminary HSBC PMI Hit 7-Month High

China’s manufacturing sector hit a seven-month high in October, according to the HSBC Flash China Manufacturing Purchasing Managers’ Index.

The index rose to 50.9 from 50.2 in September.

Businesses reported that new orders and backlogs of work both increased at a faster rate. New export orders also rose, while input and output prices were higher. However, employment levels fell, albeit at a slower rate.

"October’s HSBC Flash PMI implies that China’s growth recovery is becoming consolidated into the fourth quarter following the bottoming out in the third quarter," says Qu Hongbin, chief economist for Greater China at HSBC. "The momentum is likely to continue in the coming months, creating favorable conditions for speeding up structural reforms."

The Flash China Manufacturing Output Index also improved, rising to a six-month high of 51.0, from 50.2 in September.

The final HSBC PMI number is due for release on November 1.

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