BEIJING – Expansion in China’s factory sector slowed in June as export demand slackened while supply bottlenecks slowed production, official data showed on Wednesday.
Equally worrying is China’s service sector, a persistent lag in the country’s post-pandemic recovery that Beijing policymakers are keen to see to stimulate more of the economy after recent coronavirus outbreaks once again weighed on consumer spending.
The signs of weakness on both fronts come as economists lowered expectations for growth in the world’s second largest economy. In recent weeks, Morgan Stanley and Barclays, among others, have lowered their forecasts for China’s gross domestic product for the full year to below 9% and cited the effects of higher commodity prices on production and weaker than expected consumption.
On Wednesday, China’s National Bureau of Statistics announced that its official purchasing managers index for manufacturing fell slightly to 50.9 in June from 51.0 in May.
It was higher than the median forecast of 50.7 expected by economists surveyed by the Wall Street Journal and stayed above the 50 mark separating expansion from contraction for the 16th straight month. But it was the lowest in four months.