China’s factory activity took an unexpected downturn in May 2024, reflecting ongoing challenges in the property sector that continue to dampen business and consumer confidence. The manufacturing purchasing managers’ index (PMI) fell to 49.5, down from 50.4 in April, indicating contraction as it slipped below the critical 50-mark that separates growth from contraction. This decline was primarily driven by weaker output, new orders, and exports .
Source:- BBC news
Analysts had predicted the PMI to remain stable at 50.4, so the drop has heightened calls for new economic stimulus measures. The property crisis has been a significant factor, affecting various sectors and undermining efforts to pivot China’s growth model towards domestic consumption rather than investment-driven growth .
Source:- news 18
Despite some optimism from previous stronger output and trade data, the recent PMI figures underscore the fragility of China’s economic recovery. The International Monetary Fund (IMF) has raised China’s growth forecast slightly but cautioned that the property sector remains a key risk to sustained growth
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