#publisher alternate Skip to main content The Guardian - Back to home Support The Guardian Available for everyone, funded by readers Contribute Subscribe Contribute Search jobs Sign in [ ] My account * Comments & replies * Public profile * Account details * Emails & marketing ______________________________________________________________ * Membership * Contributions * Subscriptions ______________________________________________________________ * Sign out Search [ ] * switch to the International edition * switch to the UK edition * switch to the US edition * switch to the Australia edition current edition: International edition * News * Opinion * Sport * Culture * Lifestyle [ ] Show More * (BUTTON) News + World news + UK news + Environment + Science + Cities + Global development + Football + Tech + Business + Obituaries * (BUTTON) Opinion + The Guardian view + Columnists + Cartoons + Opinion videos + Letters * (BUTTON) Sport + Football + Cricket + Rugby union + Tennis + Cycling + F1 + Golf + US sports * (BUTTON) Culture + Books + Music + TV & radio + Art & design + Film + Games + Classical + Stage * (BUTTON) Lifestyle + Fashion + Food + Recipes + Love & sex + Health & fitness + Home & garden + Women + Men + Family + Travel + Money ____________________ What term do you want to search? (BUTTON) Search with google * Make a contribution * Subscribe * (BUTTON) International edition + switch to the UK edition + switch to the US edition + switch to the Australia edition * Search jobs * Dating * Holidays * Digital Archive * Discount Codes * The Guardian app * Video * Podcasts * Pictures * Newsletters * Today's paper * Inside the Guardian * The Observer * Guardian Weekly * Crosswords * Facebook * Twitter * Search jobs * Dating * Holidays * Digital Archive * Discount Codes * Business * Economics * Banking * Money * Markets * Project Syndicate * B2B (BUTTON) More Chinese economy This article is more than 1 month old Chinese manufacturing slows as trade war with US dents confidence This article is more than 1 month old Sector slows for sixth month amid growing uncertainty over pact with Washington Phillip Inman @phillipinman Thu 14 Nov 2019 18.50 GMT Last modified on Fri 15 Nov 2019 09.06 GMT * Share on Facebook * Share on Twitter * Share via Email Workers produce coats in a factory in Nantong, Jiangsu province, China [ ] Workers produce coats in a factory in Nantong, Jiangsu province. China’s economy shows further signs of strain. Photograph: AFP/Getty China’s manufacturing sector slowed for the sixth month in a row in October, and by more than expected, as the tit-for-tat trade war with the US and weaker consumer demand dampened activity in the world’s second-largest economy. Industrial production, the main engine of the Chinese economy, grew at annual rate of 4.7% in October, down from 5.8% in the previous month, according to the National Bureau of Statistics. The slump mirrored a drop in retail sales growth back to a near 16-year trough and the weakest growth in investment in new plant and machinery on record. Analysts said uncertainty about a possible pact between Beijing and Washington over a “first stage” trade deal dampened business and consumer confidence. This week Donald Trump said he would increase tariffs on Chinese imports unless Beijing agreed to a broad set of demands that would open its domestic markets to US competition. The Hong Kong protests were also discouraging investment and hitting retail sales. The territory’s Hang Seng index dropped for the seventh day, by a further 1%, though the the Shanghai composite index remained flat. Burberry and Cathay Pacific profits dented by Hong Kong protests Read more China was hit by a slowdown in GDP growth to 6% in the third quarter, from 6.2% in the second quarter, its lowest level in 30 years. Analysts said the latest data pointed to a further slowdown in growth in the fourth quarter. Sophie Altermatt, an economic researcher at the private bank Julius Baer, said: “The disappointing October activity data suggests a further slowdown in the fourth quarter cannot be avoided.” Fixed-asset investment, a key driver of economic growth, rose 5.2% from January to October, against expected growth of 5.4% and the weakest pace since records began in 1996. Infrastructure investment rose 4.2% in the first 10 months, slowing from a 4.5% gain between January and September, while retail sales increased by 7.2% year-on-year in October, missing expected growth of 7.9% and matching the more than 16-year low hit in April. China’s steel output fell to a seven-month low in October, while the cement production contracted for the first time in more than a year. Martin Lynge Rasmussen, the China economist at Capital Economics, said a minor first-stage deal with the US was unlikely to resolve the trade dispute and would merely allow the focus to shift to the more intractable issues that could lead to the talks breaking down. Meanwhile, Germany narrowly avoided a recession after the economy grew by 0.1% in the third quarter. It followed a second-quarter fall in GDP of 0.2%, revised down from a previous estimate that suggested the economy had contracted over the period by 0.1%. Timo Wollmershäuser, the head of economic forecasting at the German business lobby group, the Ifo, said the turnaround was mainly attributable to industry. IFRAME: https://www.theguardian.com/email/form/plaintone/3887 Analysts had feared Europe’s largest economy was heading for a second quarter of negative growth, the technical definition of a recession. German businesses have spent the past year coping with sharply declining sales by working through backlogs of work, theIfo said, and factories were now running in line with long-term trends. “Although this sector is still in recession, the rate of decline in production has slowed down. A major contributing factor is that goods exports are on the upswing again after plummeting in the previous quarter,” Wollmershäuser said. “One reason for this may be that the mood in the manufacturing sector in the export markets has improved again since the middle of the year, especially in emerging economies.” Household finances had remained in robust shape despite a slowdown in employment growth, he said, with private households recording high levels of income growth. “Alongside an appreciable rise in collective wages, state transfer payments such as pensions and child benefit also increased in the middle of the year. In addition, mortgage interest rates fell sharply once again in the course of the year, and the granting of housing loans continued to gain momentum,” Wollmershäuser said. Topics * Chinese economy * Manufacturing sector * China * Asia Pacific * Global economy * Economics * US foreign policy * news * Share on Facebook * Share on Twitter * Share via Email * Share on LinkedIn * Share on Pinterest * Share on WhatsApp * Share on Messenger * Reuse this content more on this story * Financial markets surge after £87bn Chinese cash increase Record high on Wall Street and share rises in Europe following US-China trade deal progress Published: 2 Jan 2020 Financial markets surge after £87bn Chinese cash increase * White House expecting agreement with China 'within next week or so' Trade adviser Peter Navarro suggests little more than translation of text is needed Published: 30 Dec 2019 White House expecting agreement with China 'within next week or so' * Easing trade tensions fuel pre-Christmas shares rally Donald Trump promises that a US-China trade pact will be signed ‘very shortly’ Published: 23 Dec 2019 Easing trade tensions fuel pre-Christmas shares rally * Wall Street hits high as Trump raises hopes of US-China trade deal Expectation is Washington may scrap plans to increase tariffs on fresh range of Chinese goods Published: 12 Dec 2019 Wall Street hits high as Trump raises hopes of US-China trade deal * + Markets in tailspin amid fears US-China trade deal is in peril Published: 4 Dec 2019 Markets in tailspin amid fears US-China trade deal is in peril + Trump says China-US trade deal could wait until after 2020 election Published: 3 Dec 2019 Trump says China-US trade deal could wait until after 2020 election + US-China trade war: hopes of deal rise after partial easing of tariffs Published: 7 Nov 2019 US-China trade war: hopes of deal rise after partial easing of tariffs + Trump says US-China trade deal is close, but market nosedives Published: 31 Oct 2019 Trump says US-China trade deal is close, but market nosedives (BUTTON) More more on this story Most popular * Business * Economics * Banking * Money * Markets * Project Syndicate * B2B * News * Opinion * Sport * Culture * Lifestyle IFRAME: /email/form/footer/today-uk + Contact us + Complaints & corrections + SecureDrop + Work for us + Privacy policy + Cookie policy + Terms & conditions + Help + All topics + All writers + Digital newspaper archive + Facebook + Twitter + Advertise with us + Search UK jobs + Dating + Discount Codes Support The Guardian Available for everyone, funded by readers Contribute Subscribe Back to top © 2020 Guardian News & Media Limited or its affiliated companies. All rights reserved. (BUTTON) Close [p?c1=2&c2=6035250&cv=2.0&cj=1&comscorekw=Chinese+economy%2CManufacturi ng+sector%2CChina%2CAsia+Pacific%2CWorld+news%2CGlobal+economy%2CBusine ss%2CEconomics%2CUS+news%2CUS+foreign+policy]