China manufacturing activity contracts in August, surveys show
This photo taken on June 26, 2012 shows workers at the Haier factory in Qingdao in eastern China’s Shandong province.
China’s thousands of factories and workshops are in trouble, two separate surveys show.
Manufacturing activity in August fell to the lowest level in more than three years, according to a survey published by HSBC today, MarketWatch reported.
Agence France-Presse reported that the final reading of the British bank’s purchasing managers’ index fell to 47.6 last month, from 49.3 in July.
The reading has been below 50, which separates contraction from expansion on the 100-point scale, for 10 months in a row.
It followed the release of official data on Saturday, which showed manufacturing activity contracted for the first time since November 2011, Reuters reported.
The survey of purchasing mangers by the China Federation of Logistics & Purchasing and the National Bureau of Statistics shows activity fell to 49.2 in August from 50.1 in July.
HSBC economist Qu Hongbin said the data showed China’s manufacturing sector faced “intensifying downward pressure.”
"China's exporters are facing increasing difficulties amid stronger global headwinds," Qu was quoted by AFP as saying.
Most share markets in Asia closed higher today because the weak data means Beijing is more likely to provide stimulus for the world’s second-largest economy.
This would be good news for China and the rest of the world.
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