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China’s factory activity drops to a near two-year low in April as trade tariffs bite

  • China's manufacturing activity contracted sharply in April 2025, reaching its fastest pace of decline in nearly two years amid rising trade tensions.
  • The decline followed a previous month of growth and came as the US imposed tariffs up to 145 percent, triggering Beijing to respond with 125 percent duties on American imports.
  • The National Bureau of Statistics reported the Purchasing Managers' Index fell to 49 in April, below the 50 threshold separating growth from contraction, and down from 50.5 in March.
  • NBS statistician Zhao Qinghe attributed the drop to a high base effect and external changes, while economist Zhiwei Zhang said the trade war primarily drove the weak manufacturing PMI.
  • This contraction amid sluggish domestic demand and a prolonged property crisis suggests economic growth faces headwinds, with many economists viewing the government's 5 percent annual growth target as ambitious.
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The Economist broke the news in London, United Kingdom on Tuesday, April 29, 2025.
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