China manufacturing growth stabilises in April

China's factory expansion stabilised in April while inflationary pressures eased a tad as the government presses ahead with tightening steps to tame price rises, a survey showed on Tuesday.

The HSBC flash manufacturing purchasing managers' index (PMI), the earliest available indicator of China's industrial activity, was at 51.8 in April, unchanged from the final reading in March. A figure above 50 points to expansion on the month.

The flash PMI, designed to provide a preview of the final data, which is due on May 3, indicated limited impact on China's factories from the disruption to global supply chains after Japan's devastating earthquake and tsunami.

The sub-index of input prices fell to 63.1 in April, an eight-month-low but still indicating persistent price rises.

"The Flash Manufacturing PMI reading remained flat in April, confirming that manufacturing sector growth has stabilised at a steady pace. Meanwhile, prices continue to rise, albeit at a slower pace," Qu Hongbin, HSBC's chief China economist, said in a statement.

"All these, plus the stronger-than-expected growth and inflation data last Friday, suggest that inflation remains the top macro risk, calling for continuous tightening efforts in the coming months to cool down inflationary pressure into the second half of 2011."

The flash PMI, compiled by British research firm Markit, is based on up to 90 percent of total responses to the monthly survey and is designed to be an accurate snapshot of the final data, which is usually released on the first working day of every month.

This is the third month that HSBC has published a flash PMI for China. In March, the flash reading was 52.5, which turned to be 0.7 percentage points higher than the final reading.