China Manufacturing PMI Contracts to 49.3 in October
China’s official manufacturing purchasing managers’ index (PMI) fell to 49.3 in October, down from 50.1 in September, missing economists’ consensus forecast of 49.9 and slipping below the 50‑point threshold that separates expansion from contraction. The non‑manufacturing PMI also weakened, declining to 49.7 in October from 50.2 in September, signalling a slowdown in services and construction activity. These figures suggest that the world’s second‑largest economy lost momentum at the start of the fourth quarter after a modest recovery over the preceding three months.
Beijing’s annual growth target of 4.5%‑5% heightens pressure on policymakers, who have already rolled out several targeted stimulus measures. Existing initiatives include expanded credit support for small businesses and consumers, mortgage subsidies for eligible homebuyers, additional bond‑issuance quotas for local governments, and accelerated construction of major infrastructure projects such as the Six Networks programme that underpins artificial‑intelligence and broader infrastructure ambitions. Despite these steps, the latest PMI data indicate that the measures have not yet produced a sustained improvement across manufacturing and services.
Chinese policymakers have signalled a willingness to introduce further stimulus if economic conditions deteriorate further, leaving markets attentive to the possibility of additional policy announcements before year‑end.