China's manufacturing PMI drops to 50.0, ending expansion

China’s manufacturing activity stalled in May, official data showed Sunday, halting two consecutive months of expansion as weaker demand and rising global energy costs weighed on the sector. The official manufacturing Purchasing Managers’ Index (PMI) registered 50.0, exactly at the threshold that separates expansion from contraction, according to the National Bureau of Statistics (NBS). The reading declined from 50.3 in April and 50.4 in March.

Key sub-indexes pointed to softening conditions. The new orders index fell to 49.9 from 50.6 in April, dipping into contraction territory, while the production index edged down to 51.2 from 51.5. The new export orders sub-index contracted more sharply, dropping to 48.6 from 50.3 the previous month. Analysts noted that weakness in foreign demand was particularly prominent in consumer goods manufacturing.

Officials attributed the slowdown to a combination of factors. NBS statistician Huo Lihui stated that supply and demand in industries including petroleum, rubber, and plastics showed continued weakness, while overall production remained stable with a slight slowdown in market demand. The data indicates persistent challenges for the world’s...