ECONOMY LOSES MOMENTUM

CHINA’S manufacturing sector in October expanded at its weakest pace in over two years, hurt by slowing domestic and external demand, in a sign of deepening cracks in the economy from an intensifying trade war with the US. Anxiety about China’s cooling growth and its likely drag on the global economy have vexed financial markets recently, and yesterday’s official Purchasing Managers’ Index (PMI) indicates more stress for investors. The official PMI – which gives global investors their first look at business conditions in China at the start of the last quarter of the year – fell to 50.2 in October, the lowest since July 2016 and down from 50.8 in September. It was a touch above the 50-point mark that separates growth from contraction for a 27th straight month, but undershot the 50.6 forecast in a Reuters poll. The latest reading suggests a further loss of momentum in the world’s secondbiggest economy, and the deteriorating environment for businesses could prompt more policy support from Beijing on top of a raft of recent initiatives. New export orders contracted for a fifth straight month. |