According to Nomura analysts, with economic growth in the major economies of Europe and the Americas set to drop by around 15 per cent year-on-year in the second quarter, China’s exports seem poised to fall.
As the official data revealed, factory activity in China expanded at a slower pace in May as the country attempts to get back on track after the coronavirus with the global economic slump making the sector’s recovery difficult.
China’s factories stirred back to life after the lifting of strict lockdown measures imposed when the deadly pathogen surfaced in the central city of Wuhan, but the spread of the virus worldwide has dragged down key foreign markets – weighing heavily on Chinese exports.
The Purchasing Managers’ Index (PMI), a key gauge of activity in China’s factories, was at 50.6 points in May, remaining above the 50-point mark separating growth from contraction each month.
But the figure was down slightly from 50.8 the month before, and 52 in March, according to the National Bureau of Statistics (NBS).
Non-manufacturing PMI was at 53.6 in May, a slight increase from the month before, with the NBS flagging that the construction and service industries are showing signs of recovery.
Business activity in the cultural, sports and entertainment industry, however, remains low with many entertainment venues still closed amid fears of a second wave of COVID-19 infections.