China factory activity edges up in November but remains in contraction

China’s factory activity rose in November but remained stuck in contraction for the eighth straight month, while services weakened as the boost from previous holidays faded, according to official data released on Sunday.

The manufacturing PMI rose to 49.2, up 0.2 points From OctoberThe National Bureau of Statistics said. These numbers are in line with economists’ expectations in a Reuters poll, but they remained below the 50-point mark that separates expansion from contraction.

The non-manufacturing business activity index fell to 49.5, down 0.6 points from October, while the composite PMI production index fell to 49.7, indicating a slight decline in both manufacturing and services activities.

Manufacturing supply and demand improved modestly, with the production index reaching the threshold of 50 and new orders rising to 49.2, said Hugh Lee Hui, chief statistician at the bureau’s Service Industry Survey Center.

The high-tech manufacturing sector remained expanding for the tenth straight month at 50.1, even as production of manufacturing equipment and consumer goods fell below 50. Energy-intensive industries recorded a slight rebound to 48.4, up 1.1 percentage points from October.

Small factories recorded the strongest improvement. The small-cap PMI jumped to 49.1, its highest level in nearly six months, while the mid-cap PMI rose to 48.9. The index of major manufacturers weakened, falling to 49.3.

Market confidence showed a slight increase. The index measuring production and operations expectations rose to 53.1. Industries, including non-ferrous metal smelting and aerospace-related equipment, recorded particularly strong sentiment, with readings above 57.

Non-manufacturing activity, which includes construction and services, has been mitigated and affected by services. Hoo And return the decline This is partly because the impact of early spending from the holidays has faded.

China Golden Week holidaywhich usually lifts consumer spending and travel before activity returns to normal in the following months, lasted from October 1 to 8 this year.

Services sector activity fell to 49.5, down 0.6 percentage points from October, although some strengths remained: rail transport, telecommunications, broadcasting, satellite broadcasting and financial services all recorded readings above 55.

Real estate and residential services continued to decline below the level of 50, which confirms the continued weakness in real estate-related activity. Construction activity improved to 49.6, supported by stronger near-term growth expectations, with the sector confidence index rising to 57.9.

The non-manufacturing new orders index fell to 45.7, reflecting weak demand. Production input prices rose to 50.4, and service sector sales prices reduced their decline, although they are still below 50.

Employment in the manufacturing sector rose slightly to 48.4, while non-manufacturing employment rose slightly to 45.3. Supplier delivery times to factories have been improved to 50.1.

China surveys nearly 3,200 manufacturers and 4,300 non-manufacturing companies for its monthly PMI readings, which are seasonally adjusted and considered a leading indicator of economic momentum.

Manufacturing activity in China has contracted since last April, when US President Donald Trump took power New definitions launched That put pressure on the producers.

Industrial profits It fell 5.5% in OctoberIt was the biggest decline since June, reflecting the strong gains seen in late summer. Profits of major industrial companies for the first 10 months rose 1.9%, slowing from the pace of the January-September period.

The broader Chinese economy has slowed as it grows Declined to 4.8% In the third quarter.

Trade tensions with the United States escalated in October with Washington He threatened to impose new 100% customs duties. Before the two sides reach a Late month deal In South Korea. The agreement reduced US tariffs linked to fentanyl to 10% from 20%, temporarily suspended Beijing’s controls on trace elements for a year, and reopened China’s purchases of US soybeans and other agricultural commodities.

Despite the truce, demand at home remains weak. A Prolonged decline of ownership Poor business conditions affect consumer spending. Policymakers have pointed to a long-term push to increase consumption and self-reliance in technology, but have avoided major new stimulus as the economy remains on track to meet its needs. 5% growth target.