China's factory activity unexpectedly slid in July, official data showed Friday, as leaders in the world's second-largest economy struggle to reignite domestic demand.The country's manufacturing sector has faced uncertainty this year due to the Middle East war, which has driven up global energy prices and disrupted shipping.
Booming exports underpinned by strong demand overseas for electronics and AI hardware have provided a lifeline as consumption at home remains weak.
The manufacturing purchasing managers' index (PMI), a closely watched gauge of industrial health, fell into contraction territory at 49.2, data by the National Bureau of Statistics showed Friday.
That was well below the 50.1 expansion forecast by a Bloomberg survey of economists, and also down from June's 50.3.
"Domestic weakness appears largely to blame – while the export orders index softened a bit, it remains relatively strong compared to the past few years," wrote Julian Evans-Pritchard of Capital Economics.
