Dark Skies for China Manufacturing

I recently wrote and published a series of articles on the current malaise in China’s economy and the domino effect it is having (and will continue to) on the overall growth of the global economy. An interesting article in the Europe Edition of Bloomberg’s Five Things to Start Your Day that I read very early this morning had interesting insight and data on the most up-to-date news on China’s especially important manufacturing sector performance.

It reported that “China’s manufacturing activity contracted for the fifth consecutive month in August, as calls grow for the government to take concrete steps to boost the world’s second-largest economy. The official?manufacturing purchasing managers’ index?rose slightly to 49.7 last month, according to the National Bureau of Statistics, in contraction but still an improvement over the 49.3 reading in July. The nation’s manufacturers have been struggling for months because of a slump in global demand and subdued domestic spending.?Deflation has put pressure on industrial profits as well, with data on Sunday showing a?contraction?in July.”[1]

I found the chart that was also included with their note interesting and have reproduced it below. ? Bloomberg, 2023.

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[1] www.bloomberg.com , August 31, 2023, Europe Edition.

It will be interesting to see what happens in the future to this critical cog in the Chinese economy and the impact it will have on both global trade and the international factoring industry for the balance of 2023 and well into 2024. As you can see on the Bloomberg chart above, the slump in manufacturing in China has swooned year to date and it bears close watching by all.