HONG KONG (AP) — China’s factory activity unexpectedly slowed in July, the first such contraction in five months, weighing on the pace of broader growth for the world’s second-largest economy.The official manufacturing purchasing managers index, or PMI, fell to 49.2 from 50.3 in June, China’s National Bureau of Statistics said Friday, worse than what economists had expected.The sub-index on new orders fell to 48.5 in July — the lowest since 2023 — from 51.2 in June, while the sub-index for production fell to 49.9 from 51.4.PMI readings, based on surveys of factory managers, are measured on a scale of 0 to 100. A reading above 50 indicates an expansion, and below 50 reflects a contraction.“The latest (PMI) reading remains an unpromising start to the first wave of economic data for the second half of the year,” Lynn Song, a chief economist for Greater China at ING Bank, said in a commentary.
Weakness in domestic goods demand, including in building activity, contributed to the lower PMI figures, according to Capital Economics, while several typhoons that hit China in July may have also disrupted manufacturing. China’s economy has been under pressure from sluggishness in domestic spending and investment, as a yearslong weakness in its massive property sector hits consumer confidence. Fierce competition for jobs has left workers worried over spending.
