According to the latest figures released, China's Purchasing Managers' Index has increased to 50.6 in December, recording a third month of growth indicating the economy is on the path of strong growth in the coming year.

The National Bureau of Statistics and China Federation of Logistics and Purchasing said Purchasing Managers' Index was 50.6 in December. Experts say that the growth is mainly due to moderate increase in demand for exports and the effect of stimulus efforts from the Chinese government. Increased infrastructure spending and a new direction from the new generation of Communist Party leaders have helped boost growth in the country.

The country had recorded a Purchasing Managers' Index of 50.6 in November and analysts were expecting a rating of 51.0 in December, according to a median estimate in a Bloomberg News survey of 27 analysts. On the index, any rating above 50 means expansion while that below 50 means contraction. The index measures overall service industry activity in the country.

The final December reading of a purchasing managers' index, which was released yesterday by HSBC Holdings Plc and Markit Economics was 51.5, which is 19 months.