China’s manufacturing sector returned to growth at the end of the second quarter, according to the latest PMI data.
Higher new order inflows supported a renewed rise in production. That said, the rate at which new orders expanded was only marginal amid subdued exports. Business confidence meanwhile softened since May, and firms remained cautious with regards to staff hiring.
Turning to prices, average charges fell at the most pronounced pace since January, which in turn was supported by lower input costs in June.
The headline seasonally adjusted Purchasing Managers’ Index (PMI) rose to 50.4 in June, up from 48.3 in May.
Posting above the 50.0 no-change threshold in June, the latest figure signaled that manufacturing sector conditions improved at the end of the second quarter. Business conditions have now improved in eight of the past nine months.
Helping to lift the headline index was a renewed expansion in manufacturing production in June following a brief decline in May. While modest, the rate of growth was the quickest since November 2024, and driven by reports of firmer demand conditions.
Meanwhile, a slight accumulation of backlogged orders was recorded for the first time in three months. Meanwhile, a slight accumulation of backlogged orders was recorded for the first time in three months.
Sufficient holdings of input stocks at goods producers led to a reduction in input buying in June. Finally, supply chain conditions continued to deteriorate at the end of the second quarter, as Chinese manufacturers experienced delivery delays again in June.