China's August factory PMI edges up but stays below growth threshold

China's August manufacturing purchasing managers' index climbed to 49.8, up from 49.2 in July, according to one outlet Bureau of Statistics, but stayed below the 50 point line that defines growth. Several component indexes, including production (50.4), new orders (50.6) and export orders (50.1), recorded expansion for the first time in months. Economists such as Nguyen Hoang Nam of Capital Economics attributed the modest recovery to robust export demand, especially for semiconductors, electric vehicles and green technologies.

Export volumes surged nearly 24% in July and more than 18% in the first seven months of the year, driven by AI-related chips and higher energy costs from the Iran conflict. Huo Lihui, chief statistician, said the data reflected broader economic improvement, though sluggish domestic consumption and a weak property sector continued to weigh on growth, which slowed to a 4.3% annual rate in the April-June quarter.