Growth in factory sector slowed to a three-month low in August
The tepid reading came as
With conditions looking increasingly unsteady, analysts say more stimulus may be needed in coming months to bolster growth and offset the downdraft from the cooling housing market.
It was the lowest reading since May, though the PMI stayed above the 50-point level that separates growth in activity from contraction for a third consecutive month.
"Today's data suggest that the economic recovery is still continuing but its momentum has slowed again," said
"We think more policy support is needed to help consolidate the recovery. Both monetary and fiscal policy should remain accommodative until there is a more sustained rebound in economic activity," Qu said.
Losses for most Asian stock markets, including
"Definitely there will be more measures to keep growth momentum steady in coming months," said Zhu Qibing, economist at
"The positive impact of still accommodative liquidity conditions, faster fiscal spending, and additional policy support, including intensified support for social housing and more widespread relaxation of local property restrictions, will still likely be felt in the next few months," Wang said.
Chen Dongqi, a researcher at a government think-tank affiliated to
The PMI survey also showed employment fell at a faster pace than in July, indicating more layoffs in the manufacturing sector which could begin to erode consumer confidence.
Any marked weakening in the labour market would raise alarm bells for
A slowdown in the property market appears to be deepening, chilling activity in related sectors, while some economists fear banks may be increasingly reluctant to extend credit, particularly to private companies, as bad loans continue to rise and asset quality deteriorates.
Still, a Reuters poll in July showed analysts were divided over whether
In a bid to re-invigorate the economy,
Some economists worry there is already more money in the system than it can digest and any new injections would flow directly into speculation, not the real economy, a view echoed by the central bank in recent statements.
In the past, a typical RRR cut by the PBOC was usually 50 basis points, and it would pump about
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