Shanghai | China’s factory activity edged higher in June as official government data points to a continued recovery in the world’s second largest economy after plunging to record lows in February during the coronavirus outbreak.
China’s official data claims activity is now higher than at the same time last year before the health crisis forced the closure of its factories and crippled the global economy. Exports remain sluggish although showed signs of picking up in June.
The official manufacturing purchasing managers’ index (PMI) for June was 50.9, higher than expectations of 50.5. Last month, the index was 50.6. It has been steady for the past three months after plunging to 35.7 in February at the height of the outbreak before jumping sharply in March to 52.0.
A reading above 50 indicates expansion, while one below reflects contraction.
The latest manufacturing data showed China’s small companies were struggling to recover with a reading of 48.9 in June, falling 1.9 percentage points. Larger companies led by the construction sector lead the increase at 52.1, up 0.5 per cent.
The National Bureau of Statistics said manufacturers said export orders had increased as some major economies outside China emerged from lockdowns but it still remained below 50. The index was 42.6, up 7.3 per centage points from the previous month.
The employment index slipped to 49.1. Officials noted the service sector was showing a better rate of recovery but there were still uncertainties as many countries struggled to contain the pandemic.
