China’s Services, Factory Activity Both Contract in April

China’s service sector activity contracted in April for the second straight month as lockdowns continue to paralyze many cities, while factory activity also contracted.

The non-manufacturing Purchasing Managers’ Index (which measures services) fell to 41.9 in April, from 48.4 in March, the National Bureau of Statistics said. A reading above the 50-point mark indicates expansion in activity while a reading below indicates contraction.

Factory activity also contracted in April, as lockdowns slowed production and disrupted supply chains. The Manufacturing Purchasing Managers’ Index (PMI) fell to 47.4 in April from 49.5 in March, the National Bureau of Statistics (NBS) said.

Dozens of major China cities are believed to be in full or partial lockdowns, including the commercial hub Shanghai. With hundreds of millions of people stuck in their homes, consumption is taking a heavy hit, prompting more analysts to cut growth forecasts for the world’s second-largest economy.

China’s official composite PMI, which includes both manufacturing and services activity, also fell to 42.7 from 48.8 in March.

• Reuters, with editing by Neal McGrath

 

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