China factories seen rebounding in September as Beijing signals more aid: Reuters poll

China’s manufacturing sector is expected to rebound in September, according to a Reuters poll of 29 economists. The official manufacturing purchasing managers’ index (PMI) is forecast to rise to 50.1 from 49.8 in the previous month, signaling a shift from contraction to growth. This 50-point threshold separates expansion from contraction.

The private RatingDog manufacturing PMI, compiled by S&P Global, is also anticipated to increase to 51.6 from 51.5 in August, as per the Reuters poll. Economists attribute the improvement to the sector recovering from disruptions caused by heavy rain and typhoons in August. China's economy is projected to meet its annual growth target of 4.5% to 5%.

However, retail sales and investment data have suggested a weakening momentum. The government, during a recent State Council meeting chaired by Premier Li Qiang, announced a package of measured policy measures to address economic strains, focusing on stabilizing the property market, promoting employment, and increasing income. While broader stimulus measures are not anticipated, the Ministry of Finance may approve an additional 500 billion yuan or more in local government bond issuance quotas.

The United States and China recently agreed to lower tariffs on $60 billion worth of each other's goods, but the limited deal is not expected to significantly alter their strained trade relationship.