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China factory activity rises to 8-month high in upbeat sign

China factory activity rises to 8-month high in upbeat sign

Hong Kong, May 31 : Chinese factory activity grew at its fastest rate in eight months on stronger demand, a survey showed Thursday, in a positive sign for the world’s No. 2 economy despite trade tensions with the U.S.

The official purchasing managers’ index rose to 51.9 in May from 51.4 the previous month. Readings above 50 indicate expansion, while lower numbers indicate contraction on the index’s 100-point scale.

Production, new export orders and overall new orders all increased from the previous month, indicating an uptick in demand, the China Federation of Logistics & Purchasing’s survey found.

The latest figures show China’s outsized export-manufacturing sector remains resilient despite continued tensions with the U.S. over the trading relationship between the world’s two biggest economies.

Earlier this week, President Donald Trump’s administration said it would slap $50 billion worth of tariffs on Chinese technology while imposing new investment restrictions and export controls.

The tariff threat came ahead of U.S. Commerce Department Secretary Wilbur Ross’s visit to Beijing on Saturday for negotiations on a deal for China to buy more U.S. farm goods and energy products.

Activity in China’s increasingly important services sector also expanded. The group’s non-manufacturing PMI rose to 54.9 for the month from 54.8 previously.

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