China’s manufacturing sector continued to shrink in October, with the official National Bureau of Statistics (NBS) purchasing-managers’ index (PMI) reading falling to 49.0, down 0.8 percentage points from September. A reading below 50 marks contraction
The October reading of 49.0 marks the seventh consecutive month of contraction in the manufacturing sector.
With the manufacturing PMI firmly in contraction territory, the outlook for China’s overall growth faces risk. Given that manufacturing supports a large portion of employment and investment, a sustained slump could drag on the broader economy, even though services are doing better. Until the manufacturing side turns, China’s efforts to reach its full-year growth targets may become more difficult.
