2023-11-01 03:14:14
Asian manufacturers faced increased pressure in October as factory activity in China declined once more, dampening recovery prospects for the region’s top exporters, already battered by weak demand. weaker global economy and higher prices.
Purchasing Managers’ Indices (PMIs) for major factories in China, Japan and South Korea showed a contraction in activity, while Vietnam and Malaysia also had to deal with the growing fallout from the slowdown of the Chinese economy.
China’s Caixin/S&P Global manufacturing PMI fell to 49.5 in October from 50.6 in September, according to a private sector survey on Wednesday, falling back below the 50.0 point threshold that separates growth from contraction.
The Chinese survey echoes Tuesday’s negative reading of the official PMI index, which also showed an unexpected contraction in activity, casting doubt on recent recovery hopes in the world’s second-largest economy.
“Overall, manufacturers were not in good spirits in October,” Wang Zhe, an economist at Caixin Insight Group, said of the Chinese survey results.
“The economy has shown signs of recovery, but the foundations for recovery are not strong. Demand is weak, many internal and external uncertainties remain and expectations are still relatively low.”
The impact of China’s slowdown is being felt in countries like Japan and South Korea, whose manufacturers rely heavily on demand from the Asian giant.
Japanese factory activity contracted for the fifth consecutive month in October, according to the latest PMI from Jibun Bank.
The result comes a day following official figures showed that production at Japanese factories grew much less than expected in September, due to a significant slowdown in demand.
Japanese machinery makers, such as Fanuc and Murata Manufacturing, recently reported weak half-year results due to sluggish Chinese demand.
In South Korea, industrial activity fell for the 16th consecutive month, while PMIs in Taiwan, Vietnam and Malaysia also reported continued declines in activity.
The International Monetary Fund (IMF) has warned that China’s weak recovery and the risk of a longer housing crisis might further cloud Asia’s economic outlook.
In its global economic outlook released last month, the IMF cut its growth estimates for next year in Asia to 4.2%, from 4.4% forecast in April, and to 4.6% forecast for this year . (Reporting by Leika Kihara, Editing by Sam Holmes)
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