Ekonomické zprávy

Activity in China's manufacturing sector contracted last month

Data published by the National Bureau of Statistics (NBS) showed that the manufacturing PMI fell to 49.2 points in April from 51.9 points in March. Economists had expected the index to decline to 51.4 points. The index dropped below 50 points, indicating a reduction in activity in the sector, for the first time since December 2022, which was due to weak global demand and the high-base effect from the quick manufacturing recovery in the first quarter.

According to the report, the production index fell to 50.2 points (a 4-month low) from 54.6 points in March, and the index of new orders fell to 48.8 points from 53.6 points. The export sales index contracted for the first time since January, and amounted to 47.6 points compared with 50.4 points in March. The employment index fell to 48.8 points from 49.7 points, while the business sentiment index reached a 4-month low - it fell to 54.7 points from 55 points in March.

Meanwhile, the non-manufacturing PMI declined in April to 56.4 points from 58.2 points in March. Still, the latest reading indicated the fourth straight month of expansion in services activity following the removal of pandemic restrictions by Beijing late last year.

The data also showed that the composite PMI output index, which measures the change in activity in the manufacturing sector and the service sector, fell to 54.4 points (a 4-month low) from 57.0 points in March (a record high).

In general, economists assume that the PMI data, along with other ambiguous economic signals, will likely keep the pressure on the government to continue its supportive fiscal and monetary policies in the second quarter.

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