China Nov official PMI seen shrinking for 4th month

Workers assemble automobiles in a factory in Zouping, east China

BEIJING: Activity in China's manufacturing sector likely shrank for a fourth straight month in November, a Reuters poll showed, underlining persistent sluggishness in the world's second-largest economy.

The official manufacturing Purchasing Managers' Index (PMI) likely stayed at 49.8 in November, the same pace as in the previous two months, according to a median forecast of 23 economists in a Reuters poll.

A reading below 50 points suggests a contraction in activity while a reading above signifies an expansion on a monthly basis.

"Previous stimulus measures have only helped steady the economy for now," said Nie Wen, analyst at Hwabao Trust in Shanghai.

"We don't see obvious recovery momentum for the economy in short term due to sluggish domestic and external demand."

Factory activity shrank in October for a third month in a row, fuelling fears that the economy may be cooling more rapidly than expected.

Despite a long series of stimulus measures, including slashing interest rates six times since November last year, muted monthly data for October suggested China's economy lost further momentum.

Official data showed China's October factory output growth hit a 7-month low and investment expansion slipped to its weakest pace since 2000, fuelling bets that Beijing would roll out more support in coming months.

Some analysts hope China's economy will bottom out in the fourth quarter as a burst of stimulus measures rolled out by Beijing gradually take effect, but many of them remain wary about the outlook.

China's Premier Li Keqiang said on Tuesday that China was on track to reach its economic growth target of about 7 percent this year, and the economy was going through adjustments to maintain reasonable medium- to long-term growth.

The official PMI factory numbers will be released on Tuesday along with the official services PMI.- Reuters