China’s factory activity shrank further this month, falling to a one-year low, a private survey showed Thursday, suggesting that economic conditions are continuing to deteriorate in the country despite supportive government measures.
HSBC’s preliminary China purchasing managers’ index (PMI) for April came in at 49.2, compared to the March final reading of 49.6 and falling short of expectations.
Economists polled by Reuters had expected the April ‘flash’ reading to be equal to the final figure for last month.
The latest data shows that after a brief rebound in February, the index has been back in negative territory for two consecutive months.
A reading above 50 indicates expansion in factory activity while a figure below that points to contraction from the previous month.
According to the preliminary April data, new orders index fell further to a one-year low of 49.2 from the March reading of 49.8, pointing to softer domestic demand, Reuters reported.
Meanwhile, declines in input and output prices, which had appeared to moderate in March, showed signs of accelerating again, signaling intensifying deflationary pressures, it said.
However, there were a few bright spots, including a moderation in the pace of decline in employment and a rise in export orders.
Overall, the weak PMI will stoke worries that the world’s second largest economy is decelerating more rapidly than what most analysts — and perhaps some policymakers — had expected, Reuters noted.
– Contact us at [email protected]