China's manufacturing sector growth accelerated unexpectedly in May, signaling that the economy may be stabilizing after a slowdown in the first quarter of 2013.
The headline purchasing managers' index, that measures the performance of the factory sector, rose to 50.8 in May from 50.6 in April, a survey by the China Federation of Logistics and Purchasing and the National Bureau of Statistics showed Saturday.
Economists had forecast the index to fall to 50. Readings above 50 indicate expansion of the sector.
The new orders index rose marginally to 51.8 in May from 51.7 in April. The production index rose to 53.3 from 52.6 in the previous month.
Meanwhile, the input price index jumped to 45.1 from 40.1 in April. However, the reading remained below the 50 no change-mark, suggesting that prices declined solidly last month, albeit at a slower pace than in April.
The report sharply contradicts preliminary survey results published by HSBC and Markit Economics last month. According to the HSBC survey, China's manufacturing sector contracted for the first time in seven months in May largely due to poor domestic demand.
China's economic growth eased to 7.7 percent in the first quarter from the 7.9 percent expansion in the fourth quarter of 2012. Industrial production, retail sales and fixed asset investment reported lackluster growth in April, suggesting fragile recovery.
Recently, the International Monetary Fund has lowered China's growth forecasts to 7.75 percent for this year and the next. The lender had earlier projected 8 percent growth for 2013 and 8.2 percent for 2014.
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