China Manufacturing Contracts More Than Expected

China’s official NBS Manufacturing PMI declined to 49.0 in October 2025, down from 49.8 in September and below market forecasts of 49.6. While factory activity contracted for the seventh consecutive month, the pace of decline was the slowest in the sequence, highlighting the need for further stimulus to boost domestic consumption. Output contracted for the first time in six months, falling to 49.7 in October from 51.9 in September, while new orders shrank at a faster pace (48.8 vs 49.7). Foreign sales fell the most since April (45.9 vs 47.8), and buying levels declined the most in five months (49.0 vs 51.6). Employment also contracted at a slightly faster pace (48.3 vs 48.5), while delivery times lengthened the most in five months (50.0 vs 50.8). On the price front, input cost inflation eased to a three-month low (52.5 vs 53.2), while selling prices fell at the steepest pace since June (47.5 vs 48.2). Looking ahead, business confidence weakened to a three-month low (52.8 vs 54.1).