China's factory activity improved more than expected in June, as booming exports offset cooling growth in the domestic economy.
The official manufacturing purchasing managers' index climbed to 50.3, versus 50 in May, the National Bureau of Statistics said Tuesday. The median estimate of economists surveyed by Bloomberg was 50.1.
The non-manufacturing measure of activity in construction and services unexpectedly rose to 50.2 from 50.1 last month, the statistics office said. Any reading above 50 signals growth in the sector.
The figures are among the first indications of how the economy fared at the end of the second quarter after a surprise pickup to start the year. Evidence so far suggests it's heading toward a sharp slowdown, with retail sales and investment falling at a pace unseen since the pandemic.
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A spurt in sales overseas this year is providing a cushion for China by shoring up industrial production. But without stronger demand at home, the economy still faces risks ahead despite tentative relief for global shipping and energy prices after the US-Iran deal to reopen the Strait of Hormuz.
A global investment supercycle in artificial intelligence is meanwhile driving up prices and demand for hardware made by the world's manufacturing powerhouse. In May, China's export prices jumped at their fastest rate in over three years, in a turnaround after a long streak of declines.
Adding to strains on the economy, the European Union is weighing fresh measures to counter a flood of exports from China. On Monday, the two economic powers agreed to set an October deadline to make progress on their disagreements, according to the bloc's trade chief Maros Sefcovic, who spoke after talks in Brussels with Chinese Commerce Minister Wang Wentao.
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As an economic chill sets in, investors are looking to policymakers for signs of support. This week, China's central bank set the interest rate on its new overnight liquidity tool at a level that was below expectations, Bloomberg reported Monday. Some economists see the move as a de facto rate cut that could help lower market borrowing costs.
(This story has not been edited by NDTV staff and is auto-generated from a syndicated feed.)
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