Data in the past few months pointed to a slowdown in the Asian giant but policymakers have aggressively been cutting interest rates and said that stabilizing growth is a priority.
Bank of America analyst Ting Lu expects NBS manufacturing PMI to rise to 50.4 in July, up marginally from 50.2 in June.
The policy easing measures have seen business and consumer confidence recover slowly. But Lu warns that a significant rebound won't be seen for a few months, since policy easing measures come through with a lag.
He also warns that unusual weather patterns could impact industrial and construction activity. "Weather has been abnormally poor in July, which could have a negative impact on industrial and construction activity. It was unusually hot in large parts of China in the first half of July, but then rainstorms and floods hit many areas of China after mid-July."Don't Miss: SocGen's Presentation On The Slowing State Of The Chinese Economy >
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