China Caixin manufacturing PMI deteriorates in July

1st Aug 2024 08:02

(Sharecast News) - Activity in China's manufacturing sector deteriorated more than expected in July, according to data released on Thursday.

The Caixin purchasing managers' index fell to 49.8 from 51.8 in June, versus expectations for a reading of 51.5. A reading above 50 indicates expansion, while a reading below signals contraction.

Wang Zhe, economist at Caixin Insight Group, said: "Supply continued to outpace demand. Manufacturers' output grew for the ninth straight month in July, although the growth was marginal, indicating the production expansion was limited."

Wang said performance on the demand side was weaker, with total new orders declining for the first time since July last year.

Gabriel Ng, assistant economist at Capital Economics, said: "The Caixin manufacturing PMI plummeted last month to a nine-month low and its official counterpart also declined which suggests that overall Q3 got off to a poor start.

"But the government seems intent on ramping up policy support, which should aid a recovery in activity in the coming months."