China's factory activity declines as export orders fall

China's official manufacturing purchasing managers' index (PMI) fell to 49.3 in October, indicating a contraction compared to 50.1 in September and 49.8 in August.

The PMI, which measures business activity on a scale from 0 to 100, indicates contraction when readings fall below 50.

Several subindexes, including new export orders, showed contraction, with the export orders index dropping to 48.7 from 50.0 in September.

The production subindex also declined to 49.8, down from 51.7 in September, reflecting ongoing challenges in the manufacturing sector.

Chinese companies continue to export more goods to offset weak domestic demand, which has been affected by the prolonged property sector downturn.

Trade partners, including the EU, have raised concerns about growing trade deficits, with the EU citing a daily deficit of $1.1 billion in 2025.

China has been increasing exports to Europe, Southeast Asia, and Latin America since the U.S. imposed higher tariffs last year.

Germany's President Frank-Walter Steinmeier emphasized the need for trade rebalancing during his visit to China, meeting with President Xi Jinping and Premier Li Qiang.