China's Growth Accelerates - Best In Over 5 Years

China’s manufacturing sector has likely grown to the fastest pace in more than five years, a December survey of purchasing managers reported early Monday.

The HSBC Holdings Plc and Markit Economics purchase manager's index rose to a seasonally adjusted 56.1 from 55.7 in November. It was the highest reading for the index since April 2004.

The report sees China’s growth accelerating to 9.4% this year from an estimated 8.5% in 2009 as the Chinese government continues its stimulus and other world economies recover from the 2008 financial credit crisis.

Lu Ting of the Bank of America-Merrill Lynch in Hong Kong said, "China’s strong recovery momentum will boost manufacturers’ confidence and improved earnings will help them to increase investment and output."

Chinese manufacturing firms' profits rose 7.8 percent in the first 11 months of last year to a record $379 billion.

Like the US Federal Reserve, China officials have pledged a policy that will not make the mistake of ending stimulus policies too soon -- a stance that continues to contribute to the record growth acceleration.