Indonesia's Manufacturing Sector: Contracting for 17 Straight Months

China's manufacturing outlook deteriorated in February, according to two surveys of factory activity released Tuesday, a day after Beijing loosened credit to counter sluggish conditions in the world's second biggest economy.

This was its lowest reading since February 2014 but remained above the 50 line that separates growth from contraction for a 32nd month.

United Kingdom manufacturing had its weakest month for nearly three years in February as the beleaguered sector's growth ground almost to a halt.

It is the latest gloomy snapshot of the UK's economic performance and underscores the Bank of England's signals that interest rates - held at 0.5% for almost seven years - will not be going up any time soon.

The subindex measuring output slowed to 50.2 from 51.4 while new orders, new export orders and order backlogs, lead indicators for future levels of activity, came in at 48.6, 47.4 and 43.9 respectively.

It was the 17 consecutive decline in the country's manufacturing activity.

On the jobs front, Nikkei noted that February data highlighted broadly unchanged levels of employment across the Indian manufacturing sector.

Rob Dobson, senior economist at Markit, said: "Although sterling's drop will hopefully boost exports, the likely increase in import costs in coming months will be unwelcome to manufacturers, especially given the imminent introduction of the new National Minimum Wage", MNI reported. "Although businesses saw a stronger rise in new work, data implied that this was partly driven by price reductions", said Pollyanna De Lima, economist at Markit, the agency that compiles the index.

Seasonal effects may have distorted the readings, as the week-long Lunar New Year holiday fell in February.

China said on Monday it expects to lay off 1.8 million workers in the coal and steel sectors as part of efforts to reduce industrial overcapacity, but no timeframe was given.

The independent Caixin manufacturing PMI fell 0.4 percentage points month on month to 48, marking 12 straight months of contraction, with staff numbers falling at their sharpest rate since January 2009.

China's official non-manufacturing PMI, also released on Tuesday, also fell to 52.7 from 53.5 in January.

"Early signs suggest stimulus has yet to gain significant traction, pointing to the need for continued and expanded policy support", Bloomberg News economists Tom Orlik and Fielding Chen wrote in a note.

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