An initial reading of China’s manufacturing sector showed a worse-than-expected contraction, contrasting from other recent data suggesting stabilization in the world’s second largest economy. Meg Teckman reports.
China’s factories may disappoint overall economy
Stabilizing hopes for the Chinese economy may be dimming on Friday (Jul 24) as the country’s factories falter.
An initial reading of the Caixin/Markit PMI for July dropped to its lowest level in 15 months, marking a fifth-straight month of contraction.
Output and new orders from the world’s factory fell sharply, while employment figures were stronger but still faced contraction.
The recent correction and recovery in equities may also have affected the survey.
All a bleak contrast to the rosier Chinese GDP data which saw second-quarter growth of seven percent and promising signs of a rebound.
But economists are expecting this weaker July data to result in more easing from the central bank to keep the economy on track for its “around seven percent” growth target.
This month’s survey is the first set of data published by Caixin Media after it took over sponsorship from HSBC last month.