China’s factory activity contracts for seventh month amid trade war uncertainty

China’s manufacturing activity remained in contraction for a seventh consecutive month in October, official data shows, as the world’s second-largest economy continues to battle persistent external headwinds and soft domestic demand.

The manufacturing purchasing managers’ index (PMI) stood at 49 in October, down from 49.8 the previous month, according to data released on Friday by the National Bureau of Statistics.

The reading fell short of the 50 projected by economists polled by financial data provider Wind.

The monthly index compiles survey data given by supply chain managers from a variety of sectors. A reading above 50 suggests economic expansion, while one below 50 indicates contraction.

“Affected by factors such as the early release of some demand before the National Day holiday and a more complex international environment, manufacturing activity in October slowed down compared to the previous month,” said Huo Lihui, chief statistician of the bureau’s Service Survey Centre, noting that both demand and supply have slowed.

The new orders sub-index – a measure of manufacturing demand – came in at 48.8 in October, down from 49.7 a month earlier. Meanwhile, the production sub-index dropped to 49.7 from 51.9 in September.