Better Looking PMIs Belie a Weak Chinese Economy

China’s factory activity surprisingly expanded in March, government data showed on Wednesday, but analysts are still betting on more easing measures to come, to prevent growth from slipping further.

The official Purchasing Managers’ Index (PMI), the bellwether of large industrial firms, rose to 50.1 in March from February’s 49.9, a touch above the 50-mark that that separates growth from contraction. A Reuters forecast had expected a figure of 49.8.

The reading was better than the March HSBC final PMI, also released Wednesday, which showed the nation’s vast manufacturing sector in contraction. The 49.6 final print, however, is stronger than the preliminary figure of 49.2.