China’s official PMI, the bellwether of large industrial firms, declined to 50.3 in November, below market consensus of 50.5 and down from 50.8 in the previous month, according to data released by China’s National Bureau of Statistics.
The output sub-index dropped by 0.6 percentage points to 52.5%, and the new order sub-index fell by 0.7 percentage points to 50.9%.
The decline of November PMI is partly due to the APEC Summit, during which the government reduced industrial production in order to provide better air condition for the meeting in Beijing, according to a report by Bank of America Merrill Lynch.
"The People’s Bank of China’s rate cut appears to fail to improve the sentiment, and we see little improvement in activity indicators in November," says ANZ Greater China chief economist Liu Ligang in a research report.
China’s central bank will continue to ensure sufficient liquidity provision, including potentially cutting down reserve ratio ratio (RRR), says a research report by UBS AG.