China’s factory activity unexpectedly contracted in July, with the official manufacturing PMI falling to 49.2 from 50.3 in June, signaling the first contraction in five months, according to Reuters. Weak domestic demand, slowing new orders, and rising production costs weighed on manufacturers, while the non-manufacturing PMI also slipped into contraction.
The data adds to concerns that China’s economic recovery is losing momentum despite strength in some high-tech industries. Beijing has pledged additional fiscal support, but analysts say weak consumer demand and global uncertainty continue to pose significant challenges to growth.
