China economy slows further as manufacturing sector PMI contracts for third straight month
- February’s manufacturing index drops to 49.2 from 49.5 in January after analysts had predicted an unchanged reading
- Composite purchasing managers’ index falls to its lowest level in two years at 52.4 from 53.2
China’s economy slowed further in February with manufacturing activity contracting for a third straight month, while services and construction activity eased further in a month cut short by the Lunar New Year holiday.
The composite purchasing managers’ index (PMI), published by China’s National Bureau of Statistics on Thursday, fell to 52.4 in February from 53.2 in January.
The latest reading is the lowest since the bureau started publishing the composite index in January 2017.
The decline was led by factory activity, which fell further into negative territory in February as the manufacturing index dropped to 49.2 from 49.5 in January.
The drop was larger than expected, with analysts forecasting an unchanged reading of 49.5, according to a Bloomberg survey.
A reading below 50 means the manufacturing sector contracted in February.
Growth in activity in the non-manufacturing sector, which includes services and construction, also slowed, with the sector index dropping to 54.3 in February from 54.7.