China Factory Activity Flat in May as New Orders Dip

China's factory activity showed no growth in May, according to an official survey released Sunday. The manufacturing purchasing managers index held at 50, down from 50.3 in April, the National Bureau of Statistics reported. A reading of 50 marks the boundary between expansion and contraction.

The new orders sub-index slipped to 49.9 from 50.6 the previous month, while the production sub-index eased to 51.2 from 51.5.

Sub-index movements The raw materials inventory sub-index declined to 48.6 from 49.3 in April. Officials have noted that China has faced less direct impact from higher global energy prices than many other economies. China maintains large oil reserves and multiple supply sources, limiting exposure to the closure of the Strait of Hormuz.

Exports have continued to support the broader economy, with shipments to Europe and Southeast Asia remaining steady. Domestic demand has stayed weak amid a prolonged property sector downturn. Government leaders have set a 2026 economic growth target between 4.5% and 5%.