China’s Manufacturing Shrinks for First Time in Nine Months as Demand Falls, Caixin PMI Shows

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Activity in China’s manufacturing sector shrank slightly in July as demand declined for the first time in 12 months, according to a Caixin-sponsored survey published Thursday, indicating that the economic slowdown in the second quarter could carry over into the third.

The Caixin China General Manufacturing Purchasing Managers’ Index (PMI), which gives an independent snapshot of the sector, came in at 49.8 in July, down from 51.8 the previous month. A reading above 50 indicates an expansion in activity, while a number below signals a contraction.

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China's manufacturing PMI fell to 49.8 in July, marking the first contraction in nine months and a decline from 51.8 in June.
The decline in demand led to the first decrease in total new orders in 12 months and a reduction in manufacturers' purchases.
The official PMI also showed contraction, aligning with indicators of a slowing economy and lower-than-expected 4.7% growth in Q2.

AI generated, for reference only

What Happened When

July 2023：: Last time total new orders decreased before July 2024.

Second quarter of 2024：: Economic slowdown in China.

June 2024：: Caixin China General Manufacturing PMI at 51.8, a three-year high.

July 2024：: Caixin China General Manufacturing PMI dropped to 49.8, indicating contraction.

July 2024：: Official manufacturing PMI released by the National Bureau of Statistics dropped to 49.4.

July 2024：: Input costs for manufacturers rose for the fourth consecutive month.

July 2024：: Output prices for manufacturers fell for the sixth time in the past seven months.

July 31, 2024：: Politburo meeting acknowledged economic challenges and pledged policy actions.

AI generated, for reference only

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