Growth in China's manufacturing sector cooled in December, as shown by the freshly released Caixin/Markit Manufacturing Purchasing Managers' Index (PMI) which had dropped into the contraction area (below 50) for the first time in about 1.5 years.
The Caixin/Markit Manufacturing PMI, released on Wednesday, dropped to 49.7, down 0.5 percentage point compared with the November data. This is also the first time the Caixin/Markit Manufacturing PMI fell into the contraction area since June 2017.
A below-50 PMI suggests economic contraction, while an above-50 level points to economic expansion.
The economic slowdown has already been shown by the PMI figure released by the National Bureau of Statistics (NBS) on Monday. According to an NBS statement released on its official website, China's Manufacturing PMI fell to 49.4, down 0.6 percentage point compared with November, the first time that figure fell into contraction territory since August 2016.
According to a Caixin report on Wednesday, the contracting manufacturing sector had been triggered by a slowdown in new orders because of lackluster market demand. The report also noted that China's new orders in the manufacturing sector dropped in December, the first of such drop since July 2016.
But the report noted that domestic manufacturers' confidence has recovered a little regarding domestic manufacturing in the next year, though they still have concerns about problems such as weakening demand and tightening manufacturing regulations.