(Yicai Global) July 2 – China's manufacturing industry maintained growth in June despite a fall in the sector's purchasing managers index for the month, the latest official data shows.

China's manufacturing PMI stood at a reading of 51.5 basis points in June, down 0.4 point from a month earlier but still 0.2 point higher than the average level seen in the first half of this year, indicating the sector has maintained expansion overall, data from the National Bureau of Statistics show.

Fundamentals in the manufacturing sector were favorable this month, said Zhao Qinghe, the senior statistician at the bureau's service survey center, adding that of the 21 industries surveyed, PMIs across 15 industries remained above the 50-mark indicating expansion.

PMIs in the manufacture of medicine, special equipment, communications, electronics and instruments were all above 54, indicating rapid growth.

Sentiment regarding imports and exports slid during the month, with the new export order index at 49.8, down 1.4 point compared to the month before. The import index hit a neutral 50.0, down 0.9 point compared to May. The readings show that the import and export of the manufacturing industry have slowed. 

Production and demand remained steady overall, with the price index continuing to rise.

China's non-manufacturing business activity index was 55 in June, up 0.1 point monthly and 0.2 point higher than the average level seen in the first half of this year. This indicates that the non-manufacturing industry maintained its steady and sound development momentum.

The service industry maintained its strong sentiment, with the sector's business activity index remaining unchanged from last month at 54.0 and 0.1 point higher than the first half average.

Expansion in the construction industry picked up in June. The sector maintained rapid growth in its business activity index hitting a record-high of 60.7 points and 0.7 point higher than the first-half average. Specifically, the housing industry's business activity index reached a high of 68.0, representing a four-month high.

The composite PMI output index was 54.4 in June 2018, down 0.2 point monthly but 0.3 point higher than the first half average indicating that Chinese companies have maintained steady and rapid expansion in production and operation activities overall for the period.

Editor: William Clegg