China's HSBC manufacturing PMI edges up to 1.5

It's the quickest expansion rate since March '11.

According to Nomura, the HSBC manufacturing PMI rose to 51.5 in December (Consensus and flash: 50.9; November: 50.5). The output index expanded at the quickest rate since March 2011.

Here's more from Nomura:

Total new orders rose despite a slight fall in new export orders, which suggests that the recovery is being driven more by domestic demand than exports.

This print further suggests the recovery is on track and that growth may remain strong in Q1 2013. Nonetheless, we are concerned about the sustainability of the recovery in H2 as the central bank recently signaled concerns over shadow banking activities and may tighten regulations to contain financial risks in H1.