China Leding Economic Index Rose at Slower Pace in March

A leading index for China rose at a slower pace in March, adding to evidence growth in the world’s second-biggest economy is moderating.

The gauge gained 0.8 percent from the previous month to 230.6, the New York-based Conference Board said in a statement today in Beijing, citing a preliminary reading. That compares with a 1 percent rise in February that was revised up from a previously reported 0.8 percent increase.

Today’s data may add pressure on policy makers to take more measures to support expansion after the economy grew the least in almost three years. China’s slowdown may cloud the outlook for a global recovery after U.S. job gains weakened and the euro-area’s fiscal crisis threatened to spread.

“This month’s reading supports a continued slowing of the economy,” Andrew Polk, resident economist at the Conference Board China Center in Beijing, said in the statement. Volatility among indicators “suggests that significant downside risks remain,” Polk said.

China’s manufacturing may contract for a sixth month in April, according to the preliminary reading of a purchasing managers’ index released yesterday by HSBC Holdings Plc and Markit Economics. If confirmed in the final reading due May 2, that would be the longest contraction since the global financial crisis.

Gross domestic product expanded 8.1 percent in the first three months of 2012 from a year earlier, the fifth quarterly slowdown, as Premier Wen Jiabao waged a campaign to cool consumer and property prices and exports weakened on sluggish global demand.

Growth Rebound

China’s economic growth is stabilizing and won’t fall “drastically,” the official People’s Daily reported yesterday, citing Pan Jiancheng, deputy director-general of the monitoring and analysis center of the National Bureau of Statistics. The economy may reach a bottom and rebound in the second or third quarter, Pan was quoted as saying.

The Leading Economic Index, first published in May 2010, captures turning points in China’s economic cycles if plotted back to 1986, the Conference Board says.

The index’s components include loans, a gauge of raw- material supplies, export orders, consumer expectations and floor space started, using data released by the central bank and the statistics bureau.

The research group said in January it made benchmark revisions to the index and started releasing the index for the previous month instead of with the prior two-month lag.