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China’s manufacturing sector continued to contract for the fifth consecutive month in September, with factory activity weakening and the services sector also showing a slowdown. The National Bureau of Statistics reported a PMI of 49.8 for September, slightly higher than August but still below the 50-mark indicating contraction. The services PMI fell to 49.9, the first contraction since December last year. The Central bank and financial regulator announced new measures to stimulate the economy, including lowering mortgage rates and launching a significant stimulus package.
In response to the economic challenges, China aims to raise funds through special bonds to boost consumer goods replacement programs and aid local governments in managing debt issues. The construction sector saw some improvement, with a PMI of 50.7 in September. Despite the stimulus efforts, weak demand and global trade tensions remain concerns for the Chinese economy. Overall, analysts expect the stimulus measures to support growth in line with the government’s target, but additional actions may be needed to address ongoing challenges.
Image: An employee works on the production line of Nio electric vehicles at a JAC-NIO manufacturing plant in Hefei, Anhui province, China.
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Emma Collins, graduated in Financial Economics from the University of Chicago in the USA in 2016. She has since worked at an asset management firm in New York, where she specializes in investment strategies and portfolio management. Emma has a keen interest in financial analysis and has published several articles in renowned financial journals. Her work focuses on providing actionable insights to investors, and she is known for her forward-thinking approach to managing financial portfolios.
