China’s Purchasing Managers’ Index (PMI) increased to a seasonally adjusted 55.1 in March from 52 in February, indicating that manufacturing is accelerating in an environment of increasing demand and loose credit, Bloomberg reported. The PMI data offers further evidence that China may wish to pursue contractionary monetary policy and allow the renminbi to appreciate relative to other currencies. The Consumer Price Index, a measure of inflation, rose 2.7% year-on-year in February, the largest increase in more than a year. Further evidence should arrive on April 15, when the country reports its first quarter GDP results.