The country of China has reported a slowdown in the growth of its manufacturing sector. The recent situation is raising some concerns that the economic recovery continues to be very fragile.
Reports state that the official Purchasing Manager’s Index – also known as the PMI – which is the key measure of manufacturing activity went down to a four-month low of 50.1 in June of this year. Even the sub-index of new orders went down and, as a result, indicated a weak demand on the market.
The economic growth of China is mainly influenced by the manufacturing and export sectors in recent years. Zhang Liqun, an economist with the Development Research Center said, “The June PMI fall, across the board on major sub-indexes, indicates downward pressure in the economy”. Another report from HSBC stated that the manufacturing activity in the country fell to a nine-month low.
HSBC – which surveys smaller firms – said that the PMI in China fell to 48.2 in June 2013, which is down from 49.2 in May of this year. The manufacturing and export sectors in China have been majorly hurt by a slowdown in the important markets such as the US and eurozone. This has a direct impact on the economic growth in general.