BEIJING: China’s manufacturing activity in December contracted for the first time in over two years, official data showed on Monday, amid a bruising trade war with the United States and a slowing domestic economy.

The manufacturing Purchasing Managers’ Index (PMI), a gauge of factory conditions, came in at 49.4 for the month, down from 50.0 in November, according to official figures from the National Bureau of Statistics (NBS).

Marking its lowest point in over two years, the PMI fell below the 50.0 mark separating expansion from contraction.

“Some industries have gradually entered the off-season of production, and companies are cautious about the recent market expectations,” said NBS statistician Zhao Qinghe in a statement.

“Second, due to factors such as more external environmental variables and slower internal demand, the recent import and export boom has been lower.” He noted that the average PMI for 2018 has been 50.9, but a slowdown in global economic growth and international trade friction had impacted China’s manufacturing industry.

After spending much of the year locked in a trade war, China and the US are now reportedly preparing for talks after a 90-day truce agreed between Donald Trump and Xi Jinping in Argentina earlier this month.

Published in Dawn, January 1st, 2019