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Wednesday, October 5, 2022
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    China’s factory activity contracts for second straight month

    BEIJING (AFP) – China’s factory activity shrank in August for the second month in a row, official data showed yesterday, as the sector was hit by strict zero-COVID restrictions and extreme heat.

    The Purchasing Managers’ Index (PMI), a key gauge of manufacturing in the world’s second-biggest economy, came in at 49.4, up from July’s 49.0 but still below the 50-point mark separating growth from contraction, National Bureau of Statistics (NBS) data showed.

    Sporadic COVID-19 lockdowns around China have dampened consumer enthusiasm and business confidence, while searing temperatures across large parts of the country this summer prompted power rationing for factories.

    The economy faced “unfavourable factors including the epidemic and high temperatures” this month, NBS senior statistician Zhao Qinghe said in a statement.

    Zhao said the data showed “the recovery of manufacturing production and demand still needs to be strengthened”, though he noted an uptick in activity in agricultural product processing and food producers ahead of the mid-Autumn festival on September 10.

    China’s manufacturing PMI has been in contraction territory for five out of the past six months, in the wake of a disruptive months-long lockdown in Shanghai and COVID-related restrictions elsewhere.

    But officials show few signs of relaxing strict pandemic curbs, with the southern tech hub of Shenzhen sealing off the world’s largest electronics market this week despite just dozens of daily cases in the city of more than 18 million.

    An employee works on an assembly line producing speakers at a factory in Fuyang city, in China’s eastern Anhui province. PHOTO: AFP
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