China’s factory activity unexpectedly expands in August, a private survey shows

Business

This photo taken on October 17, 2018 shows a worker inspecting shoes at a factory in Qingdao in China’s eastern Shandong province.

STR | AFP | Getty Images

China’s manufacturing activity expanded in August, according to results of a private survey released on Monday amid the country’s escalating trade war with the U.S.

The Caixin/Markit factory Purchasing Managers’ Index (PMI) was 50.4 in August — better than than the 49.8 analysts polled by Reuters had expected. The Caixin/Markit manufacturing PMI was 49.9 in July.

PMI readings above 50 indicate expansion, while those below that signal contraction.

The official manufacturing PMI fell to 49.5 in August, China’s National Bureau of Statistics said on Saturday — that’s compared to 49.7 in July. A Reuters poll showed analysts expected the official PMI to stay unchanged from July.

The official PMI survey typically polls a large proportion of big businesses and state-owned enterprises. The Caixin indicator, features a bigger mix of small- and medium-sized firms.

The PMI is a survey of businesses about the operating environment. Such data offer a first glimpse into what’s happening in an economy, as they are usually among the first major economic indicators released each month.

For China, the PMI is among economic indicators that investors globally watch closely for signs of trouble amid domestic headwinds and the ongoing -China trade dispute.

— Reuters contributed to this report.

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