China's growth softens slightly at year-end

 BEIJING -- China's latest economic figures, especially the purchasing managers' index in both factory activity and the services sector, indicated sagging momentum in December, with the country's growth softening slightly last quarter, economists said.

The National Bureau of Statistics is scheduled, later this month, to release China's macroeconomic data for the fourth quarter and the entire year of 2013, such as gross domestic product growth, industrial production, retail sales and fixed-asset investment.

China's economy expanded by 7.7 percent in the first nine months of 2013. GDP growth in the third quarter accelerated to 7.8 percent from 7.5 percent in the second.

On December 25, a report submitted by the State Council to the country's parliament said China's economic growth in 2013 is likely to stand at 7.6 percent. That would be the weakest growth since 1999.

Declining PMIs in December

The PMI for the non-manufacturing sector, a key measure of business activity in the services sector, fell to a four-month low at 54.6 in December, as most industries strived to find new growth engines amid slowing exports.

The figure was released on Friday by the NBS and the China Federation of Logistics and Purchasing. The federation's vice chairman Cai Jin attributed the drop mainly to a slowdown in the construction and service sectors near the end of the year.

Earlier on Wednesday, NBS and CFLP said that the PMI for the manufacturing sector, a key measure of factory activity, had dropped to 51 in December, the lowest since August of 2013.

A HSBC survey, released on Thursday, showed the final reading of China's manufacturing PMI dropped to 50.5 in December from 50.8 in November, mainly due to slower output growth.

According to the HSBC survey, the subindex of new export orders declined for the first time since August.

Though a reading above 50 indicates expansion, falling PMIs in December reflected a fourth-quarter cooldown in both factory activity and business activity in the services sector.

No policy change

Drops in both official and HSBC PMI readings last month provided evidence that the country's economy had lost steam in December, economists said.

Lu Ting and Zhi Xiaojia, China economists with Bank of America Merrill Lynch, said in a research note that the NBS/CFLP manufacturing PMI slowed down slightly more than expected to 51 in December, lower than market consensus of 51.2.

"This is the first moderation in six months, suggesting that the growth recovery since mid-July (of 2013) might have started to lose some steam," they said.