Manufacturing in China, the world's fastest-growing major economy, expanded at a slower pace in May as export growth weakened.
The Purchasing Managers' Index fell to 53.3 from a record 59.2 in April, the China Federation of Logistics and Purchasing said yesterday in an e-mailed statement.
Weaker expansion in economies around the world is cooling demand for made-in-China goods, leading the central bank to forecast a "moderate" slowing of economic growth this year. Indexes of new orders, export orders, and output all fell in yesterday's survey.
"We expect Chinese exports to continue slowing for the rest of this year, as US housing prices and consumption decline," Xing Ziqiang, a Beijing-based economist at China International Capital Corp, told Bloomberg News.
Xing said the May 12 earthquake that devastated parts of Sichuan Province was a factor in the slowing. The federation's statement didn't mention it.
The index of export orders fell to 53.4 from 58.9. The index of new orders declined to 55.4 from 65. The output index dropped to 55.7 from 66.5.
"Export growth slowed in May," said Zhang Liqun, a senior research fellow at the State Council's Development Research Center.
China's economy, the world's fourth-biggest, expanded 10.6 percent in the first quarter from a year earlier. The pace for all of last year was 11.9 percent, the quickest in 13 years.
A United States slowdown and a global credit shortage have trimmed demand for the nation's shipments. Export growth cooled to 21.9 percent in April from 30.6 percent in March. The May figure is yet to be released.
The index is based on a survey of more than 700 companies in 20 industries, including energy, metallurgy, textile, automobile and electronics.
A reading above 50 reflects an expansion, below 50 indicates a contraction.
(Shanghai Daily June 2, 2008)