China's industrial activity has the best quarter since 2020, PMI shows

China's industrial activity expanded for the seventh consecutive month in June, ending its best quarter since the end of 2020, as production and new orders continued to grow, according to a business survey released this Wednesday (1).

RatingDog's final PMI (Purchasing Managers' Index) for China manufacturing, compiled by S&P Global, fell from 51.8 in May to 51.7 in June, but was above analysts' forecast of 51.6. The 50 mark separates growth from contraction.

The average PMI for the second quarter was 51.9, the highest for any quarter since the last three months of 2020.

"Overall, the industrial sector maintained steady expansion in June, supported by sustained growth in new orders, reduced cost pressures and improved labor market conditions," said Yao Yu, founder of RatingDog.

An official survey released on Tuesday (30) showed that China's industrial activity returned to growth in June, driven by demand for chips, computers and other AI-related products.

Output grew for the seventh consecutive month, although the pace slowed to the lowest level in three months, according to RatingDog research.

Employment increased for the first time in three months, with job creation reaching the highest level since August 2023. The order book also grew for the fifth consecutive month, suggesting that companies faced increasing workloads despite higher staffing levels.

Overall, new orders increased for the 13th consecutive month, matching the longest expansion streak since 2018.

New export business, however, fell for the second month in a row. Export prices continued to rise, but at the slowest rate since March.

Cost pressures have eased further. Input prices rose for the 12th consecutive month, but at the weakest pace since January, while selling prices increased for the sixth consecutive month.

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Source: CNN