CITIC Securities: Additional Policy Tools Expected to Be Rolled Out in the Fourth Quarter

　　CITIC Securities stated in a research report that the September manufacturing PMI showed a seasonal rebound, with the business climate slightly improving compared to August. This was mainly due to companies concentrating production and inventory replenishment in September, influenced by anti-involution measures.

　　Structurally, the improvement in the business climate was primarily seen in production, finished goods inventory, and new export orders. However, domestic demand and price indicators showed signs of slowing, reflecting low consumer acceptance of price increases, and the month-on-month PPI reading may decline. By sector, some raw material industries and capital goods-related industries showed a better business climate, although the factory price indices for key anti-involution industries generally fell below 50. The non-manufacturing PMI in September widened its gap compared to historical averages, mainly dragged down by a decline in the services sector climate, possibly related to a slight downturn in the job market and extreme weather such as typhoons.

　　Overall, although the manufacturing climate marginally improved in September, indicators related to the services sector and domestic demand declined. Looking ahead, additional policy tools are expected to be rolled out in the fourth quarter to support stable economic operation.