China’s Caixin Manufacturing PMI dropped to 50.5 in December, down from 51.5 and below market expectations of 51.6, signaling a moderation in the sector’s growth.
While supply and demand expanded modestly, external demand remained a significant drag, according to Wang Zhe, Senior Economist at Caixin Insight Group.
Zhe highlighted several challenges, noting that external demand was “sluggish”, while job market suffered a “notable contraction.” Additionally, sales prices were weak, and market optimism continued to decline.
The survey pointed to “prominent downward pressures”, stemming from subdued domestic demand and challenging external conditions, which have squeezed profit margins and dented confidence.
The report also suggested that the impact of previous policy stimulus measures has yet to yield consistent results, with more time needed to gauge their effectiveness.
