China’s highest decision-making body suggested that more stimulus measures were lined up to help the economy regain momentum shortly after the release of another disappointing set of economic data, Bloomberg reports.
“The leadership is paying great attention to the problems, and will be more preemptive and take action in a timely manner,” read a statement from a Politburo meeting on Wednesday. China will uphold a proactive fiscal policy with a prudent monetary policy, the statement added.
Earlier on Thursday, October’s official manufacturing PMI surprised the market on the downside having fallen to 50.2 from 50.8. A slump in new orders and weaker output brought the index down just above the neutral mark, with small- and medium-sized businesses already in the contractionary zone.
“So far, Beijing has managed to find policies that combine targeted stimulus with steps toward reform. If demand continues to deteriorate, threading that needle will get harder to do,” said Bloomberg‘s chief economist, Tom Orlik.
Markets rebounded slightly following the Politburo’s statement. The Shanghai composite climbed 1.02% on Thursday to close at 2568.05.