In May, China's factory activity expanded, with the RatingDog China General Manufacturing Purchasing Managers' Index (PMI) registering at 51.8, slightly above the 51.6 forecasted by Reuters. However, this figure is down from April's 52.2, indicating a deceleration in manufacturing growth.
The PMI reading above 50 signifies expansion, but the decline in new export business and marginal contraction in employment suggest underlying weaknesses. Yao Yu, founder of RatingDog, noted that despite the slower growth rate, it remains one of the highest levels seen in five years.
Additionally, input prices fell for the first time in six months, although they remain high due to raw material and energy costs, as well as supply chain issues.
The official manufacturing PMI also reflected a downturn, dropping to 50 from 50.3, indicating subdued growth in the manufacturing sector, while services activity increased and construction continued to decline, according to Goldman Sachs.
Despite a 40-month low in retail sales growth in April, there was a rebound in domestic tourism and spending during the May 1 holiday, with smaller cities seeing the highest occupancy rates in hotels. This mixed economic data suggests that while there are areas of optimism, significant challenges remain for China's manufacturing and broader economic recovery