China’s Caixin PMI Manufacturing index slipped from 50.5 to 49.2 in July, marking the first contraction in three months and falling below the expected 50.3. According to Caixin, there was a marginal contraction in output, and total sales plummeted due to a more pronounced decline in new export orders. Additionally, both input costs and output charges saw a decrease.
Senior Economist at Caixin Insight Group, Wang Zhe, highlighted the deteriorating situation, stating, “Overall, manufacturing conditions contracted in July, with supply, demand, exports, and employment all deteriorating. Prices continued to decline, inventories rose without companies adjusting them, and logistics times increased.” He noted that manufacturers’ optimism remained, but it had weakened.
Wang further explained, “China’s economic recovery in the first quarter exceeded expectations, but the momentum weakened in the second. Although the data for industrial production and investment in June showed some signs of recovery, macroeconomic growth remained sluggish, and considerable downward pressure on the economy persisted.”
