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Nikkei Asia
2 hours ago
- Business
- Nikkei Asia
China's manufacturing activity contracts amid trade tension
BEIJING (Reuters) -- China's manufacturing activity contracted in May for a second month, an official survey showed Saturday, fueling expectations for more stimulus to support the economy amid a protracted trade war with the United States. The official purchasing managers index (PMI) improved slightly to 49.5 in May from 49.0 in April but stayed below the 50-mark separating growth from contraction, in line with a median forecast of 49.5 in a Reuters poll.
9 hours ago
- Business
China's factory activity contracts in May, but there are signs of improvement
BEIJING -- China's factory activity contracted in May, according to an official survey released on Saturday, although the decline slowed from April as the country reached a deal with the U.S. to slash President Donald Trump's sky-high tariffs. China's purchasing managers index rose from 49.0 in April to 49.5 in May, the National Bureau of Statistics said. PMI is measured on a scale from 0 to 100, where 50 marks the cutoff between expansion and contraction. Meanwhile, the manufacturing index showed growth in the sector, although the index measuring new orders remained under 50 despite some improvement. National Bureau of Statistics senior statistician Zhao Qinghe said some companies with U.S. business reported accelerated resumption of foreign trade orders, and there was an improvement in import and export conditions. The U.S.-China deal, reached earlier this month, cuts Trump's tariffs from 145% to 30% for 90 days, creating time for negotiators from both sides to reach a more substantive agreement. China also reduced its taxes on U.S. goods from 125% to 10%. But the remaining tariffs are still higher than they were before Trump took office, and businesses and investors face uncertainty about whether the truce will last. Trump said Friday that he will no longer be 'Mr. NICE GUY' with China on trade, declaring in a social media post that the country had broken an unspecified agreement with the United States. He later said in the Oval Office that he will speak with Chinese President Xi Jinping and 'hopefully we'll work that out,' while still insisting China had violated the agreement. Over the past week, tensions between Beijing and Washington also intensified after the U.S. said it would start revoking visas for Chinese students studying in the country. China has lodged a protest with the U.S. over the matter, calling the decision unreasonable.
Time of India
10 hours ago
- Business
- Time of India
China manufacturing shrinks in May despite trade war truce
China's manufacturing activity shrank in May for the second month running, official data showed Saturday, despite Beijing reaching a temporary ceasefire in a blistering trade war with the United States. Beijing and Washington agreed this month to pause staggeringly high tariffs, although US President Donald Trump on Friday accused China of breaching the de-escalation deal. While the two sides reached a temporary truce in mid-May, China recorded a contraction in factory output for the month. The Purchasing Managers' Index -- a key measure of industrial output -- came in at 49.5, according to the National Bureau of Statistics (NBS). The reading was up from April's 49 but fell short of the 50-point mark that separates growth and contraction. China's overall economic output in May "continued to expand", NBS statistician Zhao Qinghe said in a statement. According to some "US-related enterprises", foreign trade orders "restarted at an accelerated pace, and import and export conditions improved", Zhao added. The non-manufacturing PMI, which measures activity in the services sector, came in at 50.3, down from April's 50.4. Chinese leaders are aiming for economic growth this year of five percent, a goal considered ambitious by many economists as the country battles weak domestic consumption. Zhang Zhiwei, president and chief economist at Pinpoint Asset Management, said "economic momentum is stable" although companies are operating in a challenging environment. "Firms in China and the US with exposure to international trade have to run their business under persistently high uncertainty," he wrote in a note. Although Beijing and Washington agreed this month to pause steep levies for 90 days, the two sides already appeared deadlocked in negotiations. Trump argued Friday that Beijing had "totally violated" the bilateral deal, without providing details. Stay informed with the latest business news, updates on bank holidays and public holidays . AI Masterclass for Students. Upskill Young Ones Today!– Join Now
The Sun
12 hours ago
- Business
- The Sun
China's manufacturing activity contracts amid trade tension
CHINA'S manufacturing activity contracted in May for a second month, an official survey showed on Saturday, fuelling expectations for more stimulus to support the economy amid a protracted trade war with the United States. The official purchasing managers' index (PMI) improved slightly to 49.5 in May from 49.0 in April but stayed below the 50-mark separating growth from contraction, in line with a median forecast of 49.5 in a Reuters poll. On Friday, U.S. President Donald Trump accused China of violating a two-way deal to roll back tariffs and unveiled a doubling of worldwide steel and aluminium tariffs to 50%, once again rattling international trade. 'Recent developments between China and the United States suggest bilateral relations are not improving,' said Zhiwei Zhang, chief economist at Pinpoint Asset Management. 'Firms in China and the United States with exposure to international trade have to run their business under persistently high uncertainty. It will weigh on the growth outlook in both countries.' The new orders sub-index rose to 49.8 in May from 49.2 in April, while the new export orders sub-index rose to 47.5 from 44.7. Some firms reported a noticeable rebound in trade with the United States, with improvements in both imports and exports, said senior NBS statistician Zhao Qinghe. The non-manufacturing PMI, which includes services and construction, fell to 50.3 from 50.4, staying above the 50-mark separating growth from contraction. Analysts expect Beijing to deliver more monetary and fiscal stimulus over the coming months to underpin growth and insulate the economy from the tariffs. Interest rate cuts and a major liquidity injection were among easing steps unveiled by the central bank this month. Beijing and Washington have agreed to a 90-day pause during which both would cut import tariffs, raising hopes of easing tension, but investors worry negotiations will be slow amid persistent global economic risks. Trump's decision to single out China in his global trade war has stirred major worries about an economy that has been reliant on an export-led recovery to drive momentum in the face of weak domestic demand and deflationary pressures. On Monday, rating agency Moody's maintained its negative outlook on China, citing unease over tensions with major trade partners could have a lasting impact on its credit profile. But it acknowledged that government policy had tackled its previous concerns about the health of state-owned firms and local government debt that prompted a downgrade in late 2023. China's economy expanded faster than expected in the first quarter, and the government has maintained a growth target of about 5% this year, but analysts fear U.S. tariffs could drive momentum sharply lower. Exports beat forecasts in April, buoyed by demand for materials from overseas manufacturers who rushed out goods to make the most of President Trump's 90-day tariff pause.
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Business Standard
12 hours ago
- Business
- Business Standard
China's factory activity contracts in May amid trade tensions, PMI at 49.5
While the manufacturing index indicated sector growth, the new orders index remained below 50, signalling ongoing weakness despite some improvement New Delhi China's factory activity contracted in May, though the pace of decline eased compared to April as the country reached a deal with the United States to reduce former president Donald Trump's steep tariffs, Associated Press reported. According to the National Bureau of Statistics, China's purchasing managers index (PMI) increased from 49.0 in April to 49.5 in May. The PMI scale ranges from 0 to 100, with 50 marking the threshold between growth and contraction. While the manufacturing index indicated sector improvement, the new orders index remained below 50, signalling continued weakness despite some recovery. A senior statistician at the National Bureau of Statistics said firms engaged in US trade saw faster resumption of foreign orders, and import-export conditions showed signs of improvement. Earlier this month, China and the US reached an agreement to reduce tariffs: Trump's tariffs were cut from 145 per cent to 30 per cent for 90 days, allowing more time for detailed negotiations. China also lowered taxes on US goods from 125 per cent to 10 per cent. However, tariffs still remain higher than pre-Trump levels, and uncertainty lingers over whether the temporary truce will hold. US President Donald Trump declared on Friday that he would no longer be 'Mr. Nice Guy' with China on trade, saying that China had broken its agreement with the United States. The specific agreement Trump referred to was not detailed. Posting on social media, he said, 'The bad news is that China, perhaps not surprisingly to some, HAS TOTALLY VIOLATED ITS AGREEMENT WITH US. So much for being Mr. NICE GUY!' He acknowledged that the tariff reduction helped stabilise China's economy and provided relief to US companies struggling under high import duties, which had previously hindered their ability to import Chinese goods and threatened their businesses. These remarks highlight the persistent tensions between the world's two largest economies, with Trump seeking to demonstrate that his tariffs yield tangible benefits such as boosting US manufacturing and encouraging domestic investment. The administration also intensified its confrontation with China this week by announcing plans to revoke visas for Chinese students studying in the United States.
