China’s factory activity shrank in December for the first time in more than two years, an official survey showed Monday, intensifying pressure on Beijing to reverse an economic slowdown as it enters trade talks with the Trump administration.
The purchasing managers’ index of the National Bureau of Statistics and an industry group, the China Federation of Logistics & Purchasing, fell to 49.4 from November’s 50.0 on a 100-point scale. Any reading below 50 shows that activity is contracting. The December figure was the lowest since February 2016 and the first drop since July 2016.
FILE – In this Friday, Feb. 24, 2017, file photo, a factory worker uses a gas torch on an air conditioning condenser unit in a factory in Jiaozhou, eastern China’s Shandong Province. An official survey shows China’s manufacturing activity contracted in December, boosting pressure on Beijing to reverse an economic downturn amid trade tension with Washington. (AP Photo/Mark Schiefelbein, File)In the quarter that ended in September, China’s economic growth sank to a post-global crisis low of 6.5 percent compared with a year earlier. The slowdown occurred despite government efforts to stem the downturn by ordering banks to lend more and by boosting spending on public works construction.
Forecasters expect annual growth of about 6.5 percent, down slightly from 2017’s 6.7 percent. But some industry segments, including auto and real estate sales, have suffered more serious declines.
“Downward pressure on the economy is still large,” economist Zhang Liqun said in a statement issued with the PMI.