China’s Sizeable Industry Grows Less Strongly
The sizeable Chinese industry grew less strongly in July than a month earlier. The industry in China had to contend with, among other things, high raw material prices and extreme weather, such as flooding, in certain parts of the country.
In addition, maintenance work on machines also played a role in the less strong growth.
The Chinese government’s purchasing managers’ index, which measures activity, fell to 50.4 in July from 50.9 in June. A reading of 50 or more indicates growth, below that, contraction. Economists had generally expected a level of 50.8.
The industry is the world’s second-largest economy, is also dealing with chip shortages and disruptions in the global supply chain. In addition, there was weakness in China’s exports and the industry was hit by local coronavirus outbreaks, which disrupted production.
Beijing also released figures on the service sector and construction. There was a slight slowdown in growth here. For example, the construction sector suffered from high temperatures, heavy rainfall and flooding.
The Chinese government said the economy continues to grow, but at a slower pace than before. The government has announced that it will continue to support the economy with fiscal and monetary stimulus.