China’s manufacturing may contract for a second month in December as Europe’s debt crisis weighs on exports and home sales slide, preliminary results from a survey indicate.
The reading of 49 for a purchasing managers’ index reported by HSBC Holdings Plc and Markit Economics today compares with a final number of 47.7 for November. The dividing line between contraction and expansion is 50.
China’s money-supply expanded by the least in a decade in November and Communist Party leaders yesterday described the global outlook as “very grim,” underscoring the case for monetary and fiscal easing to support growth. The central bank announced a cut in lenders’ reserve requirements on Nov. 30, the day before the HSBC PMI indicated the nation’s biggest contraction in manufacturing since March 2009.
— With assistance by Yanping Li