According to reporting by Reuters, China’s factory growth figures declined to their slowest pace in two years, while Chinese exports are seen slipping further back as the US-China trade war continues to produce economic drag throughout the Sino region.
Key highlights
As noted by Reuters, China’s rate of factory expansion in October declined to its slowest pace in over two years, with external demand continuing to dry up as China’s government continues to try and prep their domestic economy for a protracted trade war with the United States.
Investor anxieties over China’s rapidly-dwindling growth figures are beginning to show cracks in the PMI figures for the Asian megacountry, with the official PMI rate for October coming in at just 50.2, declining from September’s 50.8 and the key indicator’s lowest reading since July of 2016.
The Chinese PMI has held above the critical 50.0 midpoint for 27 consecutive months, but a dip below that level indicates immediate expectations of a contraction in growth.
“All the numbers from China’s PMI release today confirm a broad-based decline in economic activity,” said Raymond Yeung, chief economist for China at ANZ in a client note, adding that conditions for the private sector is “much worse” than headline data suggested. “Besides an expected reserve requirement ratio (RRR) cut next January, we expect future supportive policy actions to be measured. The government’s priority is to avoid a financial blow-up.” – Reuters
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