May sees another drop in Chinese industrial manufacturing output.

May sees another drop in Chinese industrial manufacturing output.

Last year in December, China started easing its tough COVID-19 restrictions following three long years. However, the revival of the economy has been pretty sluggish since then. People's spending attitude in China is down, and the property crisis is causing trouble for many. Additionally, the sluggish global economy is adding hesitation to the demand for Chinese goods.

Zhiwei Zhang, an analyst at Pinpoint Asset Management, shared his thoughts, "China cannot rely only on exports to keep its economy going. It's crucial to boost domestic demand with more active fiscal policies." He praised the Chinese government's efforts to tackle the real estate crisis, but added that the impact on the economy might take some time to show.

Raymond Yeung, Chief Economist for Greater China at ANZ Banking Group, highlighted the potential impact of trade wars for China. "The economic upturn engineered by the manufacturing sector is still vulnerable," he said. "In the upcoming months, increasing trade protectionism may turn out to be a major hindrance." The US has already imposed high tariffs on numerous Chinese imports, and tensions in the trade relationship between the EU and China are intensifying.

Read also:

1. Despite China's efforts to ease COVID-19 restrictions in December, the Global economy has been hesitant in demanding Chinese goods due to the sluggish nature of China's economic revival and the ongoing property crisis.
2. In May, China's Purchasing Managers' Index indicated another drop in Chinese industrial manufacturing output, further reflecting the struggles in China's industrial sector following the easing of COVID-19 restrictions.
3. The continuing Coronavirus crisis and the potential impact of trade wars, with high tariffs imposed by the US and intensifying tensions in the trade relationship between the EU and China, may pose additional challenges to China's already vulnerable industrial production and global economy participation.
4. In response to the challenges faced by China's domestic economy and the sluggish global demand for Chinese goods, Zhang advocated for more active fiscal policies to boost domestic demand, citing the need for China not to rely solely on exports for economic growth.

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