By Yawen Chen and Kevin Yao
BEIJING (Reuters) - China's factory activity likely expanded again in December on stronger external demand and an infrastructure push at home, but the pace of growth is set to ease as markets await more certainty on a U.S.-China trade truce, a Reuters poll showed.
The official Purchasing Managers' Index (PMI) for December is expected to come in at 50.1, slightly above the 50-point mark that separates expansion from contraction on a monthly basis, according to the median forecasts of 27 economists.
This would be notch below November's 50.2, which unexpectedly ended six straight months of contraction as Beijing's accelerated stimulus measures buoyed domestic demand.
The recovery has been supported by a rebound in external demand, a pick-up in infrastructure investment, a still-resilient property market, and a moderate inventory restocking cycle propelled by improved growth expectations, analysts at China International Capital Corp (CIIC) said in a note.
The United States and China cooled their trade war earlier this month, announcing a "Phase one" agreement that reduces some U.S. tariffs in exchange for what U.S. officials said would be a big jump in Chinese purchases of American farm products and other goods.
Zhang Deli, a macro analyst with Guangdong-based Lianxun Securities, noted that a weekly export container shipping index tracked by the Shanghai Shipping Exchange - the China Containerized Freight Index - rebounded sharply in December, pointing to improved export demand.
But it remains unclear when and where the formal signing of a trade deal will take place, and no "Phase two" deal, which would involve tougher topics such as forced technology transfers to U.S. firms, is in sight.
Growth in China's industrial and retail sectors both beat expectations in November.
A private business survey - the Caixin/Markit Manufacturing Purchasing Managers' Index (PMI) - which analysts say focuses more on small- and medium-sized, export-driven Chinese firms - is also expected to show factory activity expanded in December.
But it is also forecast to show slightly more subdued growth than the previous month at 51.7, down from 51.8 in November.
The economy could face bigger downward pressure next year, Premier Li Keqiang said this month, underlining Beijing's challenge to stabilise growth and support employment. A separate Reuters poll showed China's GDP growth is expected at 6.2% in 2019, slowing to 5.9% in 2020.
After lowering its lending benchmark rate in November, China kept it unchanged in December, but markets widely expect further monetary easing in 2020.