(Yicai Global) July 31 -- China’s manufacturing industry continued to expand in July even though the sector’s purchasing managers index fell to a five-month low.
China’s manufacturing PMI stood at 51.2 in July, down 0.3 percentage point on the month before and representing the lowest reading in five months, data from the National Bureau of Statistics shows. The index has still remained above 51 for five consecutive months, indicating a range of relative prosperity for the industry.
The PMI reading has experienced fluctuations as some industries have entered their traditional off-seasons, NBS Senior Statistician Zhao Qinghe said, adding that extreme weather conditions such as heavy rainfall, typhoons and high temperatures, as well as heated international trade conflicts, have also contributed.
The findings show that the proportion of enterprises in which production and operation have been impacted by fluctuations yuan’s exchange rate increased 3.1 percentage points in July. Trade frictions led to some enterprises adjusting export orders as well as raw material imports. The new export orders and imports indexes were 49.8 and 49.6, respectively in July, both below the growth threshold, Zhao added.
China’s non-manufacturing PMI reading was 54 in July, 1 percentage point down from the month before. Nevertheless, this figure has remained above 54 in the high prosperity range for 11 months in a row.
The service sector business activity index came in at 53 for July, down 1 percentage points from the month before, due to an easing growth rate in the industry. The prosperity index in the construction industry has also dropped off sharply. Weather conditions since the beginning of July have impacted production and operating activities in the construction industry, with the business activity index at 59.5, 1.2 percentage point down compared with June.
The comprehensive PMI output index was 53.6 in July, down 0.8 percentage point in June. In other words, Chinese enterprises continued to expand their production and operation during the period, though the pace of growth has slowed.
Editor: William Clegg