The Chinese manufacturing industry is fourth among the manufacturing industries of the world, behind the USA, Japan and Germany. The six predominant industries in the manufacturing industry in China are petrochemicals, metallurgy, forestry, medicine, food and machinery.
As per the reports, the official PMI continues to be above 50 and as per the survey made by HSBC manufacturing is at its strongest since May 2011.
As per the survey, because of the main index which is above 50 for three successive months, it indicates that the manufacturing sector in China is expanding. If the PMI reading is below 50 it means that the growth is slow, but if it above 50 then it indicates an increase in growth. The PMI reading also shows a welcome sign for a global economy where the euro area and Japan are in recession and the US is struggling for significant growth.
As per the data given by National Bureau of Statistics, the output which is above the 50-mark, shows that the manufacturing industry is maintaining its growth expectations, but the rate of growth has weakened.
The official PMI reading was slightly below expectations, and a group of economists by Reuters predicted a rise in the PMI to 51.0 last week.
According to the report given by National Bureau of Statistics, it showed output in oil processing, quarrying and tobacco industries slipped, whereas food processing, auto manufacturing, textiles, steel and electronics have expanded.
The reports given by HSBC says that, China PMI, which gathers more data from smaller, privately held firms with a strong export focus, has increased in December to 51.5, its highest since May 2011.
According to Zhang Zhiwei, of Nomura International, the increased growth in heavy industry is mainly due to infrastructure and increasingly housing.
The report says that, because of the rise in the land prices it has resulted in widespread expectations made by the real estate market that will be revived by an investment-driven recovery which would weaken the export markets.
According to Zhang, the railway spending had been decreased in 2012 and was being rushed out before the end of the year, and rise in the land prices purchased by state-owned developers can relax in property market curbs that have to be made official.