China sees resilient economy

Bloomberg

Earliest indicators show that China’s economic engine is humming this summer. Confidence of small- and medium-sized companies rebounded in July, satellites are picking up increasing activity on the ground, sentiment of steel traders and producers has improved, while that of sales managers is at the highest level in more than two years. This buoyancy helps offset concern from wary
financial investors.
The signals point to resilience in the world’s second-largest economy, which grew a faster-than-expected 6.9 percent last quarter. Strong expansion allows policy makers to focus on cutting excessive and speculative borrowing, which may eventually hurt growth later this year.
Standard Chartered Plc’s Small and Medium Enterprise Confidence Index snapped a three-month streak of declines and rose to 56, according to the monthly survey of more than 500 companies. Pickups in sub-indexes indicate a broad-based improvement, and a majority of smaller businesses expect the yuan to remain stable, economists Ding Shuang and Hunter Chan wrote in a note.
Still, smaller firms find it tough to get loans, according to the survey. “Deleveraging has moved up the policy agenda, as the annual growth target appears within reach,” Ding and Chan wrote.
Manufacturing picked up in
July, according to the China Satellite Manufacturing Index, which rose to 50.5 this month from
49.5 in June.
Another survey from London-based World Economics Ltd. shows sentiment among sales managers rose to a 26-month high of 52.8 in July. A sub-index for the non-manufacturing sector hit a 30-month high.