Despite the U.S.-China trade truce, China's manufacturing activity shrank for the eighth consecutive month in November, according to an official survey released on Sunday, highlighting difficulties for the nation's economy.
According to China's National Bureau of Statistics, the official manufacturing purchasing managers index increased marginally from 49 in October to 49.2 in November.
A number below 50 indicates contraction on the PMI scale, which ranges from 0 to 100. Analyst forecasts were met by the contraction.
Chinese exports might become more competitive in the U.S. market as a result of a U.S. tariff decrease earlier this month, but it might be too soon to determine whether exports have picked up steam since the trade agreement.
After meeting with Chinese leader Xi Jinping in South Korea on October 30, U.S. President Donald Trump announced that the country would reduce its tariffs on Chinese goods, which raised some hopes for Chinese manufacturing and exports.
Consumer confidence is continuing being negatively impacted by a protracted downturn in China's real estate market, declining housing prices, and a decline in real estate investments.
Numerous businesses are under pressure due to fierce domestic pricing competition in a number of industries, including the automotive sector.
According to analysts, more government policy support is needed to help stimulate the economy. However, Lynn Song, senior economist for Greater China at ING Bank, said earlier this month that "policymakers appear to be delaying further policy support."
Although trade-in subsidies for electric cars and household appliances were previously implemented by Chinese authorities, some of these subsidies are scheduled to be phased off, and analysts predicted a decline in demand and sales.
Zichun Huang, a China economist at Capital Economics, stated last week that "signals on domestic demand have been mixed" and that domestic demand for manufactured products may be being impacted by the waning boost from consumer goods trade-in regulations.
For the entire year 2025, Chinese government have set a goal of about 5% economic growth. During the July-September quarter, the economy grew by 4.8%. Song noted, "This year's growth target is likely to require minimal additional support to be reached."
