China's factory activity picked up in September for a second month in a row and export orders strengthened, offering some reassurance that the world's second-largest economy can weather the global economic turmoil.
The official purchasing managers' index showed inflation pressures eased slightly, but probably not enough for Beijing to relax in its battle against soaring prices.
China's PMI inched up to 51.2 from August's 50.9, largely in line with a median forecast of 51.3 in a Reuters poll.
The new export orders index rebounded to 50.9 from 48.3 in August, which was a 28-month low. The 50-point mark is the dividing line between expansion and contraction.
China is by no means immune to slowdowns in the United States and Europe, its two biggest export markets. However, strong domestic demand and solid Asian export growth have provided some insulation.
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