Manufacturing in China shrank for a third consecutive month in December, though by a smaller margin than in November, Bloomberg reported. The December Purchasing Managers’ Index was a seasonally adjusted 41.2, up from 38.8 in November. A figure below 50 indicates a contraction of manufacturing activity. Shrinking manufacturing activity is seen as a sign that exports are continuing to slow. Relatively weak domestic consumption and overcapacity in most industries are also seen as factors keeping production down. People’s Bank of China Vice Governor Yi Gang said output growth levels may not recover until the second or third quarter of 2009.
For more on the challenges facing China’s manufacturing sector, read this story from the December issue of CER.