by Staff Writers
Beijing (AFP) Feb 28, 2014
Increases in Chinese home prices slowed in February for the second straight month, an independent survey showed Friday.
The average price of a new home in 100 major cities rose 10.79 percent year-on-year in February to 10,960 yuan ($1,783) per square metre, according to the China Index Academy, which compiled the survey.
The increase compared with a rise of 11.1 percent in January, according to the academy, the research unit of the real estate website operator Soufun.
Prices in February rose 0.54 percent from the previous month, the data showed, slowing from January's increase of 0.63 percent, but still marking the 21st straight month-on-month gain.
Beijing led the rise in the average cost of a new home among the 10 biggest Chinese cities in February, with the average price jumping 29.55 percent year-on-year to 32,764 yuan per square metre, the data showed.
Prices in the southern city of Guangzhou gained 23.37 percent year-on-year, while those in Shenzhen, near Hong Kong, rose 20.51 percent.
In Shanghai, China's commercial capital, new homes cost on average 32,022 yuan per square metre, up 14.27 percent from the same month a year ago.
The government has sought for more than three years to contain rising property prices, while also promising to increase the supply of affordable housing as price increases stoke discontent among ordinary citizens.
China manufacturing growth slows to 8-month low: govt
The purchasing managers' index (PMI) tumbled to 50.2, the National Bureau of Statistics reported on its website, in the third straight drop from 50.5 in January, 51.0 in December and 51.4 in November.
A figure over 50 indicates expansion while one below shows contraction.
This marked China's 17th consecutive month of manufacturing growth but at a slowing rate -- the lowest since a June reading of 50.1.
China's economic growth has weakened in recent years, hitting 7.7 percent in 2013, the lowest level since 1999. Analysts expect a further drop to 7.5 percent this year.
The lowered forecast comes as Beijing has pledged to reform the country's growth model so that consumers and other private actors play a more significant role, rather than massive and often wasteful state investment.
Whereas in the past authorities have reacted quickly to inject cash to stimulate a slowing economy, recently they have remained tight-fisted instead.
Two liquidity crunches occurred last year in part because officials sought to impose stricter discipline over banks amid burgeoning debt levels.
But the recent Lunar New Year, China's most important holiday, may also have dampened results, Bank of America Merrill Lynch economists Ting Lu and Xiaojia Zhi said in a research note.
"We believe the drop was mainly impacted by the Lunar New Year holiday," they wrote, adding that they expected a bounce back up to 50.5 in March.
"Markets will likely respond negatively to the reading but the impact could be limited. Policies are unlikely to be impacted by these distorted PMI readings," they said.
In another closely watched indicator of Chinese manufacturing, British banking giant HSBC said last week its preliminary PMI reading for February dropped to a seven-month low, to 48.3, down from a final figure for January of 49.5.
HSBC is set to release its final PMI reading for February on Monday.
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