China’s factory and services activity loses steam

Widespread lockdowns introduced by the Chinese authorities to tackle the latest surge in Covid-19 cases have dragged down China’s April manufacturing and services activity.

The official manufacturing purchasing managers’ index (PMI) fell to 47.4 this month from 49.5 in March, according to data published by the National Bureau of Statistics on Saturday. PMI above 50 indicates growth, while anything below this level represents contraction.

The March figure was slightly above the median forecast of a Bloomberg survey of analysts, which had predicted a fall to 47.3. Meanwhile, a Reuters poll had expected the PMI to ease to 48.

The latest reading still means that China’s factory activities were in the worst contraction since February 2020, when the early impact of the pandemic resulted in a PMI of 35.7.

China’s major cities, including the commercial hub of Shanghai, remain under full or partial lockdowns with more and more experts slashing growth forecasts for the world’s second-largest economy.

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