BUSINESS CONFIDENCE: While business confidence in China remains well above levels seen in the US and broadly comparable to India, the gap between Chinese Manufacturing and Services confidence levels has narrowed, suggesting a more balanced, albeit cautious, growth pattern. The All-Sector Business Confidence Index fell slightly to 52.7, a five-month low, reflecting a modest pullback after recent highs. Manufacturing, however, registered a four-month high at 54.1, suggesting resilience in the industrial sector. Services saw a sharper decline, slipping to 51.7, its lowest in seven months, indicating that the sector’s previously strong forward-looking optimism is softening.

STAFFING AND JOBS: Staffing levels remain uneven. Manufacturing improved to 50.0, a two-month high, suggesting firms are remaining caution but more orders to fulfil. Services, however, fell to 48.1, a 35-month low, highlighting continued caution in hiring. All-Sector staffing slipped to 48.9, its lowest in four months, reinforcing a picture of restrained labour expansion.

SUMMARY: September’s Sales Managers Survey data portrays China’s overall economy as growing slowly and unevenly but remaining difficult to interpret. Manufacturing returns as the backbone of growth, showing strong sales and rising confidence, while Services are experiencing a modest slowdown in forward-looking optimism and hiring. Overall, the economy continues its gradual shift towards a more balanced model between industrial and service activity. The key question remains whether Chinese growth can maintain momentum amid global trade tensions and domestic adjustments. For now, the evidence suggests cautious optimism, with slow but steady aggregate growth with sector-specific divergences.


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