Chinese manufacturing index at weakest since 2012

HONG KONG - Chinese manufacturing ebbed in January to its lowest in more than three years, a possible sign of further weakness in the world's No.

See Full Article

2 economy after posting its slowest annual growth in a quarter century.

An index based on an official survey of factory purchasing managers fell to 49.4 last month from December's 49.7. It was the sixth straight month of deteriorating conditions in China's massive manufacturing sector, which employs many millions of workers. The index released Monday uses a 100-point scale on which numbers below 50 indicate contraction.

The latest reading is also the lowest since August 2012 and worse than many economists were expecting. Production fell, factories cut jobs and new orders, which are a sign of overall demand, slipped into contraction last month, according to the report by the China Federation of Logistics and Purchasing.

China's economic growth has been steadily falling for the past half-decade as Beijing attempts to wean the economy off a tired model based on exports and investment in infrastructure in favour of domestic consumption and services. However, an unexpectedly sharp decline over the past two years has stoked fears of a politically dangerous spike in job losses.

China's economy grew 6.9 per cent last year, which was its slowest expansion in 25 years.

Separately, the private Caixin/Markit purchasing managers' index showed marginal improvement, with the index edging up to 48.4 in January from 48.2 in December.

The Caixin survey mostly covers smaller, private enterprises while the federation's report focuses on larger, state-owned companies.

"Recent macroeconomic indicators show the economy is still in the process of bottoming out and efforts to trim excess capacity are just starting to show results," said He Fan, chief economist at Caixin Insight Group. "

The pressure on economic growth remains intense in light of continued global volatility," said Fan, who called for policymakers in Beijing to continue rolling out finely tuned stimulus measures as needed to prevent growth from slowing too sharply.

Economic data from China are typically distorted by the Lunar New Year holiday, with factories stocking up on raw materials and rushing to fill orders before closing for an extended break that starts at different times in January or February. This year's holiday starts in a week's time.

Meanwhile, activity in China's service industries also eased off. An official purchasing mangers' index for services slipped to 53.5 in January from 54.4 the month before.



Advertisements

Latest Economic News

  • U.S. files challenge against Canadian tariffs with WTO

    Economic CTV News
    The United States says it's firing back at the Canadian government's recent retaliatory tariffs on American imports by launching a formal challenge with the World Trade Organization. The federal Liberal government introduced reciprocal duties earlier this month on some U.S. Source
  • Energy stocks weigh on Toronto market, while loonie climbs higher

    Economic CTV News
    TORONTO - Canada's main stock index was in the red in late-morning trading as losses in the energy sector led the way lower. The S&P/TSX composite index was down 77.67 points to 16,483.45, after 90 minutes of trading. Source
  • Ontario trade minister heads to Washington to defend auto industry

    Economic CTV News
    TORONTO -- Ontario's trade minister will be travelling to Washington this week to defend the province's auto industry at a U.S. Department of Commerce hearing. Jim Wilson says he will be speaking Thursday at the public hearing to investigate national security issues around imports of automobiles and automotive parts. Source
  • U.S. launches tariff challenge at WTO against Canada, Mexico, Turkey, China and EU

    Economic CBC News
    The United States has launched five separate complaints at the World Trade Organization against Canada, China, the European Union, Mexico and Turkey, in response to retaliatory tariffs those countries and groups have launched against American products. Source
  • IMF: World economy likely to grow 3.9 per cent this year

    Economic CTV News
    WASHINGTON -- The International Monetary Fund is keeping its forecast for global economic growth unchanged at 3.9 per cent this year despite worries about rising trade tensions and higher oil prices. But the lending agency is downgrading the outlook for Europe and Japan. Source
  • South African community introduces its own digital currency

    Economic CTV News
    ORANIA, South Africa -- The white Afrikaner community that famously sprang up in a sparsely populated corner of South Africa at the end of apartheid is now testing a digital currency that could reinforce its sense of independence. Source
  • CREA reports June home sales down 10.7 per cent from year ago, but up from May

    Economic CTV News
    OTTAWA -- The Canadian Real Estate Association says the number of homes sold in June was down 10.7 per cent from a year ago. The result was a five-year low for the month of June. Source
  • Average house price fell 1.3% to $496,000 in past year, CREA says

    Economic CBC News
    Home sales increased last month for the first time this year, but average selling prices are still slightly lower than they were a year ago. AnalysisHouse prices will rise again, but the million-dollar question for buyers and sellers is when?: Don Pittis Source
  • Financial forum: Virtual currencies need close monitoring

    Economic CTV News
    FRANKFURT -- An international forum on financial regulation say virtual currencies such as bitcoin do not currently pose a threat to global stability but require "vigilant monitoring" as the market is changing rapidly. The Financial Stability Board added Monday that that the highly volatile currencies raise concerns about consumer and investor protection and that data on banks' exposure to them remains scarce. Source
  • An aisle-by-aisle look at how to buy Canadian at the grocery store

    Economic CTV News
    TORONTO -- Some consumers have vowed to take their patriotism to the supermarket and buy only made-in-Canada products after the federal government slapped retaliatory tariffs on dozens of U.S. goods as part of an escalating trade war with the country's biggest trading partner. Source