Workers produce clothing for export to foreign markets at Sihong Guoshun Garment Co., Ltd., in the city of Weiying, county of Sihong, city of Suqian, Jiangsu province (east of China), 23 January 2025.
Cost photo | NUPHOTO | Getty Images
In January, the activity of Chinese factories contracted unexpectedly, partly because of a slow season as the Lunar New Year approached, reversing the growth observed in the previous three months and keeping in suspense Calls for stronger budgetary support to stimulate the economy.
The official purchase directors for January is 49.1, data published by the National Statistics Bureau Monday showed,, Compared to the estimates of Reuters surveys of 50.1.
The PMI index has remained above the 50 bar which separates the expansion of the contraction in the last three months, standing at 50.1 in December, 50.3 in November and 50.1 in October , according to official data.
The PMI Manufacturer index of January tends to be lower, while migrant workers return to their native cities before the Chinese New Year, which fell on January 29, said Hui Shan, chief economist for China at Goldman Sachs .
The CSI 300 first order index reversed its earnings earlier during the day to exchange slightly down, following the publication of data.
Despite the slowdown in the PMI Manufacturer index, the overall prospects for demand seem positive, said Bruce Pang, principal researcher to the national institution for finances and development, citing more solid figures in two price sub-indexes .
Indices measuring price levels to Improvement of the purchase and sale of major raw materials In January – although still in contraction territory – declared Zhao Qinghe, main statistician at BES, in a press release. The indicator of the perspectives of activity of production and operating of companies extended to 55.3, added Zhao, showing that most manufacturers were increasingly confident about the expansion of their activities after Holidays.
The Chinese non -manufacturing PMI index, which measures the activity of services and construction, fell to 50.2 in January, against 52.2 in the previous month.
The PMI index of services increased by 50.3, less than the previous month, but continues to grow given the demand induced by the holidays, especially in sectors benefiting from seasonal trips The urgency, such as public transport, hotels, the food industry and drinks, said Zhao du Bes.
The PMI of construction index fell to 49.3, the activity being at a standstill as the festival approaches.
“The disappointing PMI data highlights the difficulties faced by political decision -makers in achieving a sustainable resumption of growth,” said Zichuan Huang, Chinese economist at Capital Economics, in a note.
Even if economic activity could accelerate in the coming months, decision -makers being likely to intensify their recovery measures and accelerate in deficit expenses at the beginning of 2025, the economy is still struggling in the face of winds. And to the price threats of the new US administration, Huang said. said.
Profits fall for a third year
The industrial profits of China in 2024 dropped by 3.3 % compared to the previous year, extending their decline until the third consecutive year. In December, however, the benefit jumped 11 % compared to the previous year,, growing for the first time since July.
Business benefits are recovering from a sharp drop of 27 % over a year in September-their strongest decrease since March 2020 during the COVID-19 pandemic. They fell 7.3% over a year in November and 10% in October, while the slowdown in the real estate sector and the dark income prospects continued to weigh on consumer demand.
Industrial profits are a key indicator of the financial health of factories, public services and mines in China.
The second world economy has achieved the objective of official annual growth last yearRight up 5.0 %, while a boost dam was launched. Economists had underlined the The growth of industrial production exceeds that of retail saleshighlighting the solidity of the country’s supply while domestic demand remained low.
Consumer goods manufacturers saw their profits grow regularly, increasing by 3.4% last year compared to last year. BE BE statistician, Yu Weining, said in a press releaseStimulated by consumption incentive policies and strong exports.
A PMI sub-index measuring new China export orders has been 46.4 in January, its lowest level since February of last year. The level was “not bad” given the seasonal postman of the Chinese New Year, said Mr. Pang, noting that “the concentration of exports due to potential trade tensions is still underway”.
Chinese exporters rushed to concentrate their expeditions due to the concerns aroused by possible increases in customs duties. President Donald Trump threatened to impose additional customs duties of 10 % on February 1. During his electoral campaign, he had suggested customs duties greater than 60 % on Chinese products.
China’s economic slowdown has not yet experienced a “turning point”, said Shan, from Goldman Sachs, given the still low interior consumption and uncertainty about the extent and calendar of American customs tariffs. “In the end, we need a significant recovery plan on the part of the government to have a chance to improve inflation and confidence,” she added.
