A private gauge of China’s manufacturing activity slowed its pace of expansion last month, suggesting there is still room for caution as the nation charts its economic trajectory for the rest of the year.
The Caixin manufacturing purchasing managers’ index (PMI) was 50.6 last month, Caixin and S&P Global said in a statement yesterday — dipping closer to the 50 line, below which indicates contraction from the month before.
Caixin’s services index was 50.2 for the month, still in expansion but also suggesting that the pace of growth in activity is losing momentum. The figures show a slightly precarious recovery even as China has rolled out a stimulus.
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“The manufacturing sector continued a slow recovery,” Caixin Insight Group (財新智庫) senior economist Wang Zhe (王喆) said in a statement.
“Various important economic indicators have shown marginal improvement, and the macroeconomy has shown signs of stabilization. However, the economic recovery has yet to find a solid footing,” Wang said.
On Saturday, the National Bureau of Statistics and the China Federation of Logistics & Purchasing reported the official manufacturing PMI rose to 50.2 last month — the first expansion since March.
A gauge of non-manufacturing activity — which shows the services and construction sectors — improved more than expected, they said.
“The Caixin setback suggests private businesses and exporters are still under heavy pressure,” Bloomberg economist Eric Zhu (朱懌) said. “Businesses — particularly in the private sector — remain cautious on hiring.”
China’s economy has been challenged by a property crisis and weak consumer and business confidence, prompting Beijing to roll out some supportive measures.
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