China’s factory activity returned to expansion in October, with the Caixin/S&P Global manufacturing PMI rising to 50.3, up from September’s 49.3, signaling growth in smaller, private-sector manufacturers. This follows official PMI data showing the first expansion since April, suggesting stimulus measures may be helping. Demand improved, with new orders rising at their fastest pace in four months, although export orders remained weak and employment fell. Stimulus measures, such as the People’s Bank of China’s reserve ratio cut and rate reduction in September, are seen as encouraging but early steps.
Predictably, some parties and organisations hated the MTBPS and have slated it for being anti-poor. It is hardly surprising that the critics are from labour, the MK Party, and others who have socialist and communist leanings. They abhor the idea of a smaller government that does less and, even worse, the fact that capitalists are now being given the opportunity to take advantage of government failings and make more money. Ideology can be very damaging when it trumps logic and pragmatism, and these criticisms come as a stark reminder of just how much was at stake in these latest elections.
The reason that the ZAR has appreciated, that bond yields have fallen, that inflation declined below expectations and that interest rates are moderating is precisely because global investors understand this to have been the best-case scenario and that SA has a greater chance of sustainability. The alternative path or a larger inefficient government, plagued by corruption, ineptitude and cadre deployment, would’ve ensured that SA turned into a failed state. As it is, there are no guarantees that SA is doing enough. However, there is a far greater chance of sustainability and rejuvenation on the current path