Latest news with #CaixinPurchasingManagers'Index
Kuwait Times
2 days ago
- Business
- Kuwait Times
China's factory activity hits lowest since 2022
QINGZHOU: Employees work on a tractor assembly line at a factory in Qingzhou, in eastern China's Shandong province in this photo.- AFP BEIJING: Chinese factory activity hit a more than two-year low in May, a closely watched survey showed Tuesday, as a detente in Beijing's trade war with Washington was offset by ongoing domestic problems in the world's number two economy. China and the United States agreed last month to temporarily halt most tit-for-tat tariffs on each other's goods, providing some much-needed relief to global markets. But the standoff has still piled further pressure on China's economy, which already faced a long-running real-estate crisis, sluggish consumption and high levels of local government debt. The Caixin Purchasing Managers' Index, independently calculated by S&P Global and Chinese business outlet Caixin, fell to 48.3 in May, well below the 50-point threshold separating expansion from contraction. The figure was the lowest since September 2022 and well below the 50.4 seen in April. It was also sharply off the 50.7 forecast in a Bloomberg survey of economists. 'The surprisingly sharp fall... means that the survey data now point to a loss of economic momentum last month,' said Zichun Huang, China economist at Capital Economics. 'Domestic headwinds (are) more than offsetting the boost from the US-China trade truce,' she said. Wang Zhe, senior economist at Caixin Insight Group, said the slowdown was linked to 'sluggish external demand, which fell for a second straight month'. The country should target effective measures to boost domestic demand by improving household incomes, Wang added. Official data from the National Bureau of Statistics on Saturday showed a less severe contraction in the factory sector last month. While the NBS figure focuses on large state-owned industrial groups, the Caixin index primarily surveys small and medium-sized enterprises. But in a positive sign, a business sentiment survey by S&P Global and Caixin showed a slight improvement in May after a record drop in April, thanks to expectations of stronger foreign trade through the rest of the year. — AFP
Fibre2Fashion
01-05-2025
- Business
- Fibre2Fashion
China's factory growth slows in April amid tariff impact
China's manufacturing sector lost momentum in April as the pace of expansion slowed to its weakest since January, weighed down by declining export orders and ongoing tariff-related disruptions. China's manufacturing growth slowed in April, with the PMI falling to 50.4 amid weaker export demand and tariff-related disruptions. New export orders declined, output eased, and firms resumed job cuts. Despite slower input price deflation, manufacturers continued cutting selling prices, marking a fifth straight month of falling output charges. The Caixin Purchasing Managers' Index (PMI) fell to 50.4 in April from 51.2 in March, though it remained above the neutral 50.0 threshold for the seventh consecutive month, signalling continued albeit modest growth. New export orders recorded their first decline in three months, often linked to the adverse effects of increased US tariffs. This drag on external demand led to a more subdued rise in total new orders—marking the slowest pace of growth in seven months. In response, output growth eased, supported largely by firms fulfilling backlogged orders, which in turn declined for the first time since September last year, according to a release from S&P Global Ratings. With demand softening, manufacturers resumed job shedding and scaled back both input purchases and inventory levels. Business sentiment weakened, reaching its third-lowest level since data collection began in April 2012, driven by heightened concerns over trade uncertainty. Despite a slight lengthening in supplier delivery times due to supply-side constraints, subdued demand kept input costs under pressure. Although the rate of input price deflation eased, Chinese manufacturers continued to pass on cost savings to customers, leading to a fifth straight monthly drop in output charges. Export prices also fell for a third consecutive month. 'As the market outlook is overshadowed, both business and consumer confidence are subdued, making it harder to boost domestic demand. The ripple effects of the ongoing China-US tariff standoff will gradually be felt in the second and third quarters. As such, policymakers should be wellprepared, with action taken sooner rather than later,' Dr Wang Zhe, senior economist at Caixin Insight Group, said, commenting on the China General Manufacturing PMI data. Fibre2Fashion News Desk (HU)
