China’s manufacturing weakened further in July, signaling the worst of the nation’s slowdown has yet to be reached, according to a preliminary survey of purchasing managers.
The reading of 47.7 for an index released today by HSBC Holdings Plc and Markit Economics, was less than estimated and if confirmed in the final report Aug. 1, would be the lowest in 11 months. Readings below 50 indicate contraction.
Asian stocks and the Australian dollar fell as the extended weakness in production underscores Premier Li Keqiang’s challenge in meeting this year’s 7.5 percent economic growth target, with the government signaling this week that it may accept as little as 7 percent in the future. It may also boost pressure on policy makers to accelerate a shift toward consumption to sustain expansion in the longer term.