Chinese factory activity declines in April

BEIJING, Apr 30 (Reuters): China's manufacturing activity unexpectedly shrank in April, official data showed on Sunday, raising pressure on policymakers seeking to boost an economy struggling for a post-Covid lift-off amid subdued global demand and persistent property weakness.

The official manufacturing purchasing managers' index (PMI) declined to 49.2 from 51.9 in March, according to data from the National Bureau of Statistics, below the 50-point mark that separates expansion and contraction in activity on a monthly basis.

That missed expectations of 51.4 tipped by economists in a Reuters poll and marked the first contraction since December, when the official manufacturing PMI was at 47.0.

The world's second-biggest economy grew faster than expected in the first quarter thanks to robust services consumption, but factory output has lagged amid weak global growth. Slowing prices and surging bank savings are raising doubts about demand.

New export orders edged down to 47.6 from 50.4 in March, the PMI showed.

The manufacturing sector, which employs about 18 per cent of China's workforce, remains under pressure due to slack global demand. Some exporters told Reuters at the country's biggest trade fair they have frozen investments and some have cut labour costs in response.

To boost trade and employment, the cabinet last week unveiled plans, including supporting auto exports, facilitating visas for businesspeople and providing subsidies to firms.