BEIJING: China's factory activity unexpectedly dropped in October, its third contraction in four months, a government survey showed on Saturday (Oct 31), hurt by soft demand for exports as well as goods at home.
The official manufacturing purchasing managers' index (PMI) fell to 49.3 from 50.1 in September, according to data from the National Bureau of Statistics. That missed a forecast for 50.0 from a Reuters poll.
Factory activity weakened as overseas Christmas-related orders, which were front-loaded in September, cooled in October. It was also hurt when consumer spending, which climbed during China's long National Day holiday in the first week of October, fizzled out after, in a return to its long-stagnant state.
"Insufficient demand is increasing downward pressure on the economy," said Zhang Liqun, an analyst with the China Federation of Logistics & Purchasing, adding that policymakers should take the problem seriously and step up measures as soon as possible.
Sub-indexes for new orders overall and for new export orders both stayed in contraction territory in October. Production and purchasing activity also slipped into contraction from expansion.
The non-manufacturing…