Mon, May 02, 2011 - Page 11 News List

Manufacturing in China slowed last month data shows

AFP, BEIJING

Manufacturing activity in China slowed slightly last month and the costs of raw materials fell, according to official data released yesterday, as Beijing tries to cool the world’s second-largest economy.

The purchasing managers index slipped to 52.9 last month from 53.4 in March, the China Federation of Logistics and Purchasing said in a statement.

Data released by British banking giant HSBC Holdings PLC on Friday showed the index at 51.8, unchanged from March.

A reading above 50 indicates the sector is expanding, while a reading below 50 indicates contraction.

The input prices subindex, which measures the cost of raw materials and is an indicator of inflation pressures, declined to 66.2 from 68.3 in March, the figures showed.

Soaring food and housing prices are a major bugbear for China’s leaders, anxious about the potential for inflation to spark social unrest in the country of more than 1.3 billion people.

Inflation remained stubbornly high in March, with the consumer price index rising 5.4 percent year-on-year — the fastest pace since July 2008 and well above the government’s target this year of 4 percent.

Prices have remained high despite four interest rate hikes since October last year and numerous increases in the bank reserve requirement ratio.

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