Official data: China's manufacturing activity hits six-month low in August
However, industry insiders express concerns that dwindling external demand could make exports a less reliable engine for growth than in the first half of the year.
China's manufacturing activity fell to a six-month low in August as factory gate prices declined and manufacturers struggled to secure new orders. The National Bureau of Statistics (NBS) reported that the official Purchasing Managers' Index (PMI) dropped to 49.1 in August, down from 49.4 in July. This marks the index's sixth consecutive monthly decline and the fourth month in the contraction territory.
The data underscores the challenges facing China's $17 trillion economy, which has been weighed down by a prolonged property market slump, impacting both consumer confidence and business activity. Although the government has intensified efforts to prop up the sector, these measures have yet to reverse the prevailing weakness. Meanwhile, increased trade tensions with the United States and Europe are adding further headwinds to the manufacturing sector.
The new export order subindex—a key gauge of foreign demand—registered at 48.7 in August, a slight increase from 48.5 in July. However, industry insiders express concerns that dwindling external demand could make exports a less reliable engine for growth than in the first half of the year.
In contrast, the non-manufacturing PMI, which reflects sentiment in the service and construction sectors, edged up slightly to 50.3 in August from 50.2 in July.
Written by: Rochelle Nguyen