BEIJING, Oct 31 — Factory activity in China plunged more than expected in October, official data showed Sunday, suggesting the industrial sector continued struggling as it grappled with tight power supply and surging raw material costs.
The key Purchasing Managers’ Index (PMI) — a gauge of manufacturing activity in the world’s second-largest economy — fell to 49.2 this month, down from 49.6 in September, said the National Bureau of Statistics.
This marks the second straight month in which China’s PMI has dipped below the 50-point mark separating growth from contraction.
A Bloomberg poll of economists had pegged the reading at 49.7, which would have been a slight improvement.
Although the country’s PMI contracted when the spread of Covid-19 — which first surfaced in the central city of Wuhan — forced most business activity to a halt, life has largely returned to normal as strict measures brought the outbreak under control.
But the NBS said Sunday: “In October, due to factors such as still-tight power supply and the high costs of some raw materials, the manufacturing PMI fell.”
Both the production and new-order indexes were in contraction, pointing to a weakening in supply and demand, senior statistician Zhao Qinghe said in a statement.
Meanwhile, the price index continued rising, reflecting higher purchase prices of raw materials such as petroleum and coal, as well as that of sales costs.
Non-manufacturing activity fell in October as well, official data showed, as authorities noted “the recovery of the service industry has slowed”.
China’s non-manufacturing PMI came in at 52.4, down from 53.2 in September.
While the reading still indicates expansion, helped by holiday activity at the start of October, the NBS added that the threat of local outbreaks continued to cast a pall over consumer sentiment. — AFP
Source: Malay Mail
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