Chinese manufacturing growth slows as trade fears hit overseas orders

(Sharecast News) - Manufacturing activity across China slowed down more than expected in October, according to RatingDog's purchasing managers' index covering the sector on Monday, though employment levels rose for the first time in seven months. The headline manufacturing PMI fell to 50.6 last month, down from a six-month high of 51.2 in September, the closely followed RatingDog survey showed.

That was the third straight month above the neutral 50-point mark but below the consensus forecast of 50.9.

Purchasing managers noted a slowdown in new order growth during October, as better demand and sales promotions domestically was countered by a "subdued external demand".

As a result, new orders fell by their quickest rate since May, which respondents attributed to rising trade uncertainty.

There was a slight reduction in confident levels among goods producers, with the 12-month outlook falling to its lowest in six months, though overall sentiment remained positive around hopes that sales would increase over the coming year.



Additionally, the rate of job creation rose to its highest pace in more than two years as manufacturers hired to cope with existing workloads, though growth remains relatively low.

"On the demand side, heightened trade uncertainty in October caused new export orders to fall sharply into contraction territory, dragging down the new orders reading. Market concerns about weakening exports persisted," said Yao Yun, founder of RatingDog.