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China's Factory Activity Contracts in July, Pressuring Economic Growth

China's Factory Activity Contracts in July, Pressuring Economic Growth

China's factory activity unexpectedly contracted in July, marking the first decline since February. The official manufacturing purchasing managers' index (PMI) fell to 49.2 from 50.3 in June, according to the National Bureau of Statistics. This drop below the 50-point threshold indicates a contraction in manufacturing activity. The decline follows a three-month expansion driven by exporters rushing shipments ahead of U.S. tariff increases. The contraction comes as Chinese policymakers acknowledge economic challenges and pledge to accelerate fiscal spending and introduce incremental policies to support growth. The economy grew by 4.3% in the second quarter, the slowest pace in over three years, missing the full-year target of 4.5% to 5%.
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China's Factory Activity Contracts in July Amid Domestic Demand Slump

China's Factory Activity Contracts in July Amid Domestic Demand Slump

China's factory activity unexpectedly contracted in July 2026, marking the first decline since February. The official manufacturing purchasing managers' index (PMI) fell to 49.2 from 50.3 in June, according to the National Bureau of Statistics. This drop below the 50-point threshold indicates a contraction in manufacturing activity. The decline was attributed to a slump in domestic orders and disruptions caused by typhoons. The new orders sub-index fell to 48.5, the lowest in 38 months. The contraction ended a four-month period of expansion, which had been supported by exporters rushing shipments ahead of U.S. tariff increases. The construction PMI also hit a record low of 47.0, and the services gauge fell to its weakest since the initial COVID-19 lockdowns. Despite these downbeat readings, firms' expectations for future output remained optimistic, anticipating stronger fiscal policy support.
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China’s factory activity unexpectedly slips into contraction in July

China’s factory activity unexpectedly slips into contraction in July

An official survey shows China's factory activity slowed in July, the first time it has contracted in in five months
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China's Factory Activity Contracts in July Amid Demand Slump and Typhoons

China's Factory Activity Contracts in July Amid Demand Slump and Typhoons

China's manufacturing sector experienced an unexpected contraction in July, marking the first decline since February. The official manufacturing purchasing managers' index (PMI) fell to 49.2 from 50.3 in June, indicating a shift from expansion to contraction. The decline is attributed to a slump in domestic orders and disruptions caused by typhoons. The contraction ends a four-month period of growth driven by exporters rushing shipments ahead of U.S. tariff increases. The new orders sub-index dropped to its lowest in 38 months, and the construction and services sectors also showed signs of weakness. Despite the downturn, firms remain optimistic about future output, anticipating stronger fiscal policy support.
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OECD Panel Warns of Global Growth Slowdown Amid Middle East Conflict and Energy Shock

OECD Panel Warns of Global Growth Slowdown Amid Middle East Conflict and Energy Shock

The Organisation for Economic Cooperation and Development (OECD) has issued a warning regarding the global economic outlook, highlighting a slowdown in growth due to ongoing conflicts in the Middle East. The OECD's interim Economic Outlook report indicates that disruptions in energy supply, particularly through the Strait of Hormuz, have led to a surge in energy prices. This has been compounded by damage to energy infrastructure, which is affecting the global supply of energy and other commodities like fertilizers. These disruptions are contributing to increased costs, reduced demand, and heightened inflationary pressures worldwide. The report also notes that while India is projected to remain the fastest-growing major economy with a GDP growth rate of 7.6% for 2025-26, other major economies like China are expected to see a slowdown in growth due to various internal and external factors.
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China's factory activity unexpectedly shrinks in July as demand sags

China's factory activity unexpectedly shrinks in July as demand sags

BEIJING, July 31 (Reuters) - China's factory activity unexpectedly slipped into contraction in July, pressured by shrinking new orders that reinforced concerns over slowing economic growth, weak demand at home and elevated production costs.
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China's factory activity shrinks in July as demand falters, fuelling slowdown concerns

China's factory activity shrinks in July as demand falters, fuelling slowdown concerns

BEIJING, July 31 (Reuters) - China's factory activity unexpectedly slipped into contraction in July, pressured by shrinking new orders that reinforced concerns over slowing economic growth, weak demand at home and elevated production costs.
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China's Factory Activity Contracts in July, Raising Economic Concerns

China's Factory Activity Contracts in July, Raising Economic Concerns

China's factory activity unexpectedly contracted in July, marking the first decline since February. The official manufacturing purchasing managers' index fell to 49.2, below the expansion threshold of 50, due to a slump in domestic orders and disruptions from typhoons. This contraction ends a four-month period of growth driven by exporters rushing shipments ahead of U.S. tariff increases. The decline in factory-gate prices and a drop in the construction and services PMIs further highlight the economic slowdown. Analysts suggest that local governments may need to implement policy support to boost domestic demand.
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South Korea July exports beat forecasts on robust demand for AI investments

South Korea July exports beat forecasts on robust demand for AI investments

SEOUL, Aug 1 (Reuters) - South Korea's exports grew more strongly than expected in July on global chip and computer demand for AI investments.
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U.S. and China Trade Officials Discuss Commitments Ahead of Trump-Xi Meeting

U.S. and China Trade Officials Discuss Commitments Ahead of Trump-Xi Meeting

U.S. and Chinese trade officials conducted a video call to discuss commitments related to rare earths and agricultural products. U.S. Treasury Secretary Scott Bessent and Trade Representative Jamieson Greer emphasized the importance of China fulfilling its promises in these areas. The talks are part of preparations for a meeting between President Trump and President Xi Jinping in September. The discussions also covered the implementation of trade and investment boards to ensure a balanced U.S.-China economic relationship.
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China's U.S.-Bound Exports Decline in July Amid Trade Tensions

China's U.S.-Bound Exports Decline in July Amid Trade Tensions

China's exports to the U.S. experienced a decline in July, marking the first drop in several months, according to a survey by China Beige Book. This downturn follows a brief recovery in June, where exports rose by 14%. The decline is attributed to ongoing trade tensions and the anticipation of higher U.S. tariffs. The survey, conducted between July 20 and 28, involved 1,436 Chinese businesses. The report also noted a slowdown in factory activity and a decrease in retail sales, highlighting broader economic challenges facing China.
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China's factory activity expected to have stalled in July

China's factory activity expected to have stalled in July

BEIJING, July 30 (Reuters) - China's factory activity growth likely stagnated in July, as weak domestic consumption and cost pressures from the Middle East War offset the boost to production from strong global demand for Chinese goods.