2016.12.0101:09:00UTC+00China's Factory Activity Growth Moderates In November

China's manufacturing sector expanded at a slower pace in November on softer growth in new orders and production, data from IHS Markit showed Thursday.

The Caixin manufacturing Purchasing Managers' Index fell more-than-expected to 50.9 in November from a 27-month high of 51.2 in October. The reading was expected to drop to 51.

Nonetheless, the health of the sector has now strengthened in each of the past three months, which marks the longest period of improvement since late-2014.

Meanwhile, the official PMI rose unexpectedly to 51.7 from 51.2 in October. The score was forecast to fall to 51.

Although the divergence in the official and unofficial manufacturing PMIs last month suggests that some firms are faring better than others, the data nonetheless signal that China's recovery remains in place for now, Julian Evans-Pritchard, a China economist at Capital Economics, said.

"The Chinese economy continued to improve in November, although it lost some momentum compared to the previous month," Zhengsheng Zhong, Director of Macroeconomic Analysis at CEBM Group, said.

"Inventory and employment data also showed the foundation of growth is not solid yet and investors have to remain vigilant about the risk of a downturn in coming months," Zhengsheng added.

According to IHS Markit, output continued to expand at a strong pace but the rate of growth eased since October's five-and-a-half year peak.

Companies reported a softer expansion of total new orders, while new export work was broadly stable after a slight fall in October.

Meanwhile, cost-cutting initiatives underpinned a further fall in staff numbers, though the rate of job shedding was the slowest seen in a year-and-a-half.

On the price front, inflationary pressures picked up sharply in November. Both input and output prices rose at the fastest rates since early 2011.