China's private sector expanded at a slower pace in July, official survey data from the National Bureau of Statistics revealed Monday.
The manufacturing Purchasing Managers' Index dropped more-than-expected to 51.4 in July from 51.7 in June. The expected score was 51.5. Nonetheless, a score above 50 indicates expansion.
The production sub-index came in at 53.5 versus 54.4 in previous month. Likewise, the new orders index slid to 52.8 in July from 53.1 and the new export orders indicator declined to 50.9 from 52 in June.
At the same time, the non-manufacturing PMI fell to 54.5 in July from 54.9 a month ago.
On the other hand, infrastructure investment helped the construction sector to strengthen further. The PMI for the construction sector climbed to 62.5 from 61.4 in June.
PMI readings suggest that China's growth momentum may have waned at the start of third quarter as foreign demand cooled, Julian Evans-Pritchard at Capital Economics, said.
The economist anticipates further weakness ahead as the crackdown on financial risks weighs on credit expansion and economic growth.
The economy expanded at a steady pace of 6.9 percent in the second quarter, driven by domestic spending and exports. The government targets slightly slower growth of about 6.5 percent this year.
Markit Economics is slated to publish its factory Purchasing Managers' survey data on August 1. Economists forecast the indicator to remain unchanged at 50.4 in July. The services PMI is due on August 3.
by RTT Staff Writer
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