Business Maverick: Asia’s Factories May Be Over Worst as China Demand Picks Up

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Asia’s factory managers saw glimmers of hope in June, with the region’s purchasing managers indexes turning up across the board as demand from China picked up.

PMIs for Japan, South Korea, and Taiwan — the region’s manufacturing powerhouses — improved slightly but stayed below 50, the dividing line between contraction and expansion. Factory output in Vietnam and Malaysia grew for the first time since January and December before the virus spread in the region. Indonesia’s index surged almost 11 points, the biggest increase since at least 2011, while remaining below 50.

The signs of a turnaround follow another report from China earlier this week that showed an official gauge for China’s factory activityFinancial markets rallied in the second quarter, buoyed by optimism that re-openings globally would damp soaring unemployment and reinvigorate consumption. However, setbacks in controlling virus outbreaks in many countries, including the U.S., have curbed sentiment. Bloomberg Economics now expects a 4.

 

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