China manufacturing weakens further as lockdowns continue

China’s manufacturing activity fell to a six-month low in April as shutdowns continued in Shanghai and other manufacturing hubs in a bid to stem COVID-19 outbreaks, according to a survey published on Saturday.

The monthly Purchasing Managers’ Index, released by China’s National Bureau of Statistics, fell to 47.4 in April from 49.5 in March on a 100-point scale. Numbers less than 50 indicate outsourcing of activities.

National COVID-19 outbreaks have impacted Chinese factory operations and market demand, said bureau statistician Zhao Qinghe.

Some companies have reduced or stopped production, with disruptions both in logistics and in the supply of raw materials and components.

Shanghai, China’s most populous city, spent weeks in April under lockdown. The capital, Beijing, began mass testing millions of residents this week.

In the northeast, authorities in Changchun and Jilin also spent most of April under lockdown, forcing automakers and other factories to close. Other smaller Chinese cities have also faced city-wide or district-wide lockdowns.

Non-manufacturing business activity also fell 6.5 percentage points to 41.9, according to the statistics office.

Services sector activity fell to 40 from 46.7 the previous month as activity in sectors such as air transport, accommodation and food services were hit during the outbreaks, the bureau said.

However, the construction industry continued to grow, especially the civil engineering construction sector. Progress in the construction industry is expected to play a role in supporting the economic recovery, according to Zhao.