China’s manufacturing purchasing managers’ index fell to 49.3 in October, down 0.8 points from 50.1 in September and below the 50 line that separates expansion from contraction, the National Bureau of Statistics said. The reading missed the 50.0 median forecast in a Reuters poll of 23 economists, and Reuters reported it as the fastest pace of contraction in three months.
The weakness ran across the survey. The production index fell 1.9 points to 49.8 and the new orders index fell 1.1 points to 49.4. New export orders fell to 48.7 from 50.0 in September, and imports fell to 47.0. Large companies held just above the line at 50.2, down 0.4 points, while mid-sized companies fell to 48.4 and small companies to 47.5. The employment index was unchanged at 48.4.
Services and construction pulled the wider economy down with the factories. The non-manufacturing business activity index fell 0.5 points to 49.7, with construction down 2.3 points to 48.0 and services at 50.0. Construction new orders fell 5.7 points to 40.0, and non-manufacturing new orders overall fell 2.1 points to 44.4. The composite PMI output index, which combines manufacturing production with non-manufacturing activity, fell a full point to 49.7.
Price pressure eased without disappearing. The main raw materials purchase price index fell to 56.8 from 60.8 in September, and the factory gate price index fell to 51.7 from 54.0, so input costs are still rising, at a slower pace. Business expectations held up better than current activity: the production and business activity expectations index was 53.4, down 0.4 points, and the non-manufacturing expectations index was 54.7.