Key facts
- China's manufacturing sector expanded for the seventh consecutive month in June.
- The RatingDog China General Manufacturing PMI eased to 51.7 in June from 51.8 in May.
- The second quarter average PMI of 51.9 was the strongest since late 2020.
- Growth was supported by sustained new order growth, easing cost pressures, and improved labor market conditions.
- Factory output and new orders continued to rise, though the pace of output eased.
- Employment increased for the first time in three months.
- New export business fell for the second month.
- Input prices rose at the weakest pace since January, while output prices increased at the slowest rate since March.
- Manufacturers' confidence in the year-ahead outlook softened.
China's manufacturing sector expanded for a seventh straight month in June, marking its strongest quarter since late 2020, according to a survey by S&P Global. The RatingDog China General Manufacturing PMI eased slightly to 51.7 from 51.8 in May, but surpassed analysts' forecasts of 51.6. The average PMI for the second quarter stood at 51.9, the highest since the fourth quarter of 2020.
The expansion was supported by sustained growth in new orders, easing cost pressures, and improved labor market conditions. Output rose for the seventh consecutive month, though at a slower pace, while employment increased for the first time in three months. Overall new orders expanded for the 13th month in a row. However, new export business declined for the second consecutive month, and manufacturers' confidence in the year-ahead outlook softened to its lowest point since January.
Despite the positive manufacturing data, the economy shows unevenness, with factory output and exports bolstering growth while household demand remains tepid. Input prices saw their weakest rise since January, and output prices increased at a slower pace, indicating easing cost pressures.