[ad_1]
HONG KONG—Economic activity in China expanded sharply for a second straight month, in an early sign the country may be shaking off the impact of pandemic curbs sooner than expected.
A gauge of manufacturing rose at the fastest pace in more than a decade in February, while export orders expanded for the first time in almost two years, the National Bureau of Statistics said Wednesday. Services and construction activity also expanded further, the purchasing managers index report showed.
The release will be a welcome relief for China’s top leaders gathering for the annual congress of the ruling Communist Party this weekend, helping to turn the spotlight on economic growth and away from the damage caused by their zero-Covid policies. China’s economy grew 3% in 2022, one of the slowest rates in decades, as pandemic controls shut factories, depressed home sales and crushed consumer spending.
The data may strengthen the case for policy makers to raise their forecast for annual growth for this year, seen as a key step to restoring confidence in both the economy and the country’s leadership. Last year’s growth fell short of the official target of about 5.5% by a large margin.
Chinese officials and economic advisers had earlier this year debated setting a growth target of around 6% for 2023, according to people familiar with the matter. He Lifeng, who in October was added to the Communist Party’s top policy-making body, the Politburo, was devising a plan to deliver growth of more than 5% for this year, The Wall Street Journal reported in December.
The final growth target is expected to be revealed in a government work report delivered at the National People’s Congress this Sunday.
The PMI release fueled a broad rally in Chinese shares and a strengthening of the yuan. Hong Kong’s Hang Seng Index, which includes the shares of some of China’s biggest companies, was almost 4% higher by midafternoon. The mainland CSI 300 Index was up around 1.3%, while the Shanghai Composite Index had gained 0.9%.
The purchasing managers index rose to 52.6 from 50.1 in January, the National Bureau of Statistics said. A gauge on nonmanufacturing activities—including those in the services and construction sectors—climbed to 56.3 from 54.4.
A reading above 50 indicates expansion; below that signals contraction. The manufacturing PMI exceeded the median 50.5 forecast of eight economists polled by the Journal.
—Grace Zhu and Xiao Xiao contributed to this article.
Write to Stella Yifan Xie at stella.xie@wsj.com and Keith Zhai at keith.zhai@wsj.com
Copyright ©2022 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8
[ad_2]
