China: Manufacturing Shrinks for 5th Month.

China’s official NBS Manufacturing PMI inched up to 49.4 in August 2025 from July’s three-month low of 49.3, marking the fifth straight month of drop in factory activity and falling short of market estimates of 49.5. Output grew for the fourth consecutive month and at the fastest pace since March (50.8 vs. 50.5 in July), lifted by the extension of the tariff truce between Washington and Beijing for another 90 days. Also, buying levels rose the most in five months. Still, overall demand remained sluggish, with new orders (49.5 vs. 49.4) showing little improvement despite fresh consumer subsidies and export sales (47.2 vs. 47.1) continuing to falll amid weak overseas demand and lingering trade barriers. Employment stayed soft (47.9 vs. 48.0), due to job uncertainty. Delivery times shortened to a six-month high (50.5 vs. 50.3). On prices, input costs hit their highest since October 2024, while a decline in selling prices eased. Finally, confidence notched a six-month peak (50.5 vs. 50.3).