(Yicai Global) Aug. 1 -- China's National Bureau of Statistics released data on the morning of August 1 showing the manufacturing PMI of July is 49.9 percent, slightly below the critical point and 0.1 percentage lower than the previous month.
The non-manufacturing business activity index increased to 53.9 percent, 0.2 percent higher than the previous month, and achieved its highest point of the year after two consecutive months of increase.
The main reasons for the decline in July was due to heavy rain sweeping most of the provinces and cities in China and serious floods in parts of the middle and lower reaches of the Yangtze River, Zhao Qinghe, a senior statistician at China's National Statistics Bureau said. These had a great impact on the environment and businesses, in particular, manufacturing and transportation.
However, Zhao also pointed to more positive news, the PMI of high-tech manufacturing reached a new peak of 53.2 percent this year, and the widespread problem of raising hard corporate financing while labor costs are rising in China, is gradually being relieved.
Measures include freezing minimum wage increases in manufacturing hub Guangdong; the expectation index of production and business activity is 55.3 percent, 1.9 percent higher than the previous month.
Zhao also reported a steady growth in the non-manufacturing sector. Driven by the financial industry, increased tourist consumption and other industries, the business activity index of the service sector reached its highest since the second quarter. In addition, the construction industry still maintains a strong trend of expansion despite a slowdown in pace.