Asia Steel-China prices down on slow demand reocvery

Chinese spot steel prices edged down after trading firm for the past two weeks, as sentiment remained fragile over demand recovery despite a strong pick-up in manufacturing activity and reports of auto sales.

Prices of China's benchmark hot-rolled coil were quoted at 3,330 yuan ($487.2) a tonne this week, down 0.7 percent from 3,245/3,415 quoted last week, data from Metal Bulletin showed.

"Trade is relatively thin as restocking at the distribution channel level is quite slow and demand recovery from end-users remains weak," said a Chinese steel trader.

China's official purchasing managers' index, a measure of activity in the manufacturing sector, rose to 52.4 in March, marking the first time the index has been in expansionary territory since September and suggesting its economy may have bottomed out. [ID:nPEK25397]

Adding further evidence of economic recovery, China's vehicle sales, which slowed last year to its lowest annual rate in more than a decade, rose to a record high in March, helped by Beijing's policy initiatives to support the market.

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