Asia’s factories recover in October with India leading gains
02 Nov 2020
Asia’s factories pushed ahead in October as managers remained upbeat about recovery prospects and local virus outbreaks become less severe, manufacturing gauges show.
India’s purchasing managers index rose to 58.9 last month, its highest since May 2010, from 56.8 in September, while South Korea advanced to 51.2 from 49.8, and Taiwan stayed particularly strong at 55.1 in October after the previous month’s 55.2, according to IHS Markit figures released Monday. Thailand also moved above 50, the dividing line between expansion and contraction, while Japan improved to 48.7 from 47.7.
Vietnam and Malaysia retreated, though the former stayed in expansionary territory. Malaysia’s reading of 48.5 was the lowest since May.
The regional figures are getting a lift from China’s ongoing recovery, which a separate report Saturday showed remains on track. The manufacturing PMI eased slightly in October to 51.4 from 51.5, according to data released by the National Bureau of Statistics. The non-manufacturing index jumped to 56.2 after 55.9 in September.
That was followed on Monday by the Caixin Media PMI, which rose to 53.6, its highest reading since January 2011, spurred by another increase in new orders.
Still, an uncertain outlook in key trading partners including Europe and the US could drag on China’s performance over coming months, Wang Zhe, senior economist at Caixin Insight Group, said in a release.
“There are still many uncertainties outside of China, so policy makers need to be cautious about normalising post-coronavirus monetary and fiscal policies,” Wang said.
For now, goods trade has been a growth engine for the global economy in recent months while services remain hampered by restrictions on mobility and the threat of further virus outbreaks. All 10 gauges on the Bloomberg Trade Tracker have settled into “normal” status since early September — an unprecedented feat since the dashboard debuted in 2018 — and electronics production has remained particularly strong amid 5G demand and as businesses invest in pandemic-era equipment.