China’s manufacturing activity unexpectedly returned to growth in August on the back of rising new orders and export business recovery, a private survey showed Monday, helped by an extended trade-war truce with the U.S.
The RatingDog manufacturing purchasing managers’ index came in at 50.5, sharply beating the estimate of 49.7 from economists polled by Reuters.
The gauge signaled the fastest rate of expansion since March, rebounding from July’s 49.5. A reading below 50 signals contraction while one above that threshold suggests an expansion.
The improvement was in part driven by a recovery in new export order, indicating the “resilience of external demand in the face of tariffs,” Zichun Huang, China economist at Capital Economics said in a note.
“The latest upturn resembled a breath of relief rather than a sustained rally,” Yao Yu, founder of RatingDog, said in a statement, noting that external demand appears “partly pulled-forward” while domestic demand remains soft.
