BEIJING (CHINA) – Hit by a wave of domestic coronavirus infections, China’s factory activity growth was at it’s slowest pace in five months in January.
According to statement relesed by the National Bureau of Statistics, the official manufacturing Purchasing Manager’s Index (PMI) fell to 51.3 in January from 51.9 in December. It remained above the 50-point mark that separates growth from contraction on a monthly basis, but was below the 51.6 expected in a Reuters poll of analyst forecasts.
The factory activity and weighing on the services sector, including logistics and transportation were interrupted during the month where several large cities went into lockdown as millions tested positive for the coronavirus.
“The recent localised epidemic has had a certain impact on the production and operation of some enterprises, and the overall expansion of the manufacturing industry has slowed,” said Zhao Qinghe, an official at the statistics bureau.
“The period before and after the Lunar New Year is also traditionally an off-season for the country’s manufacturing industry,” Zhao said in an accompanying statement.
The coronavirus outbreak, mostly in the north, is expected to be a temporary restraining factor while China’s vast industrial sector continues to find strength in resilient export demand.
The official PMI, which largely focuses on big and state-owned firms, showed the sub-index for new export orders stood at 50.2, expanding for the fifth straight month, though down from 51.3 in December.
Economic indicators ranging from trade to producer prices all suggest a further pickup in the industrial sector.
A sub-index for small firm activity stood at 49.4 in January, up from December’s 48.8.