China’s manufacturing activity records its weakest expansion since May 2020 due to weak overseas demand. The reports are produced by Caixin.
The report indicates that China’s manufacturing activity dipped to 50.9 in February compared to January’s 51.5. Any figure above 50 indicates an expansion while any figure below that indicates a contraction. The February reading indicates that factory activity grew for 10 consecutive months, however, the growth slowed for a third consecutive month. The figures are in accordance with the Caixin China General Manufacturing Purchasing Managers’ Index.
It is reported that the manufacturing segment’s demand and supply grew slowly, as the subindexes of fresh orders and output slumped for a third consecutive month. Furthermore, a slump in the backlogs for manufacturing activities in nine months indicates weak demand.
Wang Zhe, the senior economist at Caixin Insight Group, told the media, “Overseas demand remained sluggish, with new export orders decreasing for the second month in a row. Surveyed manufacturers highlighted fallout from domestic flare-ups of COVID-19 in the winter as well as the overseas pandemic. The job market worsened as the employment subindex declined further into contractionary territory for a third consecutive month. Companies were not in a hurry to fill vacancies.”
Manufacturers were positive about the business outlook for the next 12 months. The positive approach was supported by forecasts of surging demand as economic activity resume. The reports are produced by IHS Markit.
The global economic recovery is mired by new strain of the Covid-19 virus.