A net balance of +18% of Chinese companies forecast greater output over the next 12 months. However, this is down from +26% in February, and below both BRIC (+24%) and global (+31%) averages. Confidence is softer across both the manufacturing (+15%) and service (+21%) sectors, with the former registering the joint-lowest level of optimism in the series history.
Consequently, projections for business revenues (+17%) and profits (+10%) have weakened and are among the lowest seen in the series history.
However, June’s net balance of +6% is a step down from +8% at the start of the year and much weaker than the global average (+17%). Split by sector, the pace of payroll expansion at services companies (+9%) is set to be faster than seen at manufacturers (+3%)
June survey data also point to a further rise in capital expenditure across China over the next year. A net balance of +13% of firms anticipate higher spending on capex, which is down from +21% in February.
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