Chinese manufacturing PMI index likely to have rebounded in October

Chinese manufacturing PMI data is set to release tomorrow. According to a DBS Bank research report, the manufacturing PMI is expected to have rebounded to 50 in October from September’s 49.8. On the domestic front, there were signs of a rebound. Retail sales and industrial production rebounded to 7.8 percent year-on-year and 5.8 percent in September from 7.5 percent and 4.4 percent in August respectively.

Stimulus measures are expected to continue to boost the economy. New mid-long term corporate loans continued to leapfrog by 48.3 percent in September. This might translate into further investment growth in the coming months.

“Yet, the new export order component should have stayed in contraction territory for the 16th consecutive month due to weakening global demand as well as the escalated trade tension. Potential higher tariff to be effective in December is also on the plan”, added DBS Bank.