FX.co ★ China Composite PMI Slips to 2-1/2-Year Low

In May 2025, the Caixin China General Composite PMI fell to 49.6, down from 51.1 in April, marking the first contraction in private sector activities since December 2022. Although there was a modest increase in the services sector, a more pronounced decline in manufacturing impacted the overall index negatively. Once again, new orders saw a reduction, with persistent weakness in foreign demand affecting both sectors. Employment saw a marginal decrease, primarily due to job cuts in manufacturing, and backlogs of work were reduced for the first time since January. On the pricing front, while input cost inflation eased, output prices continued their downward trend, with charges dropping at the fastest rate observed in over two years. Dr. Wang Zhe, Senior Economist at the Caixin Insight Group, commented, "The downward pressure on the economy has intensified significantly compared to previous periods." He further indicated that the impact of earlier measures aimed at boosting consumption requires further evaluation, and future policies need to be adapted to the present economic conditions.