China factory activity rebounds in March as Iran war looms over growth
AP News • • business
Key Points:
- China’s manufacturing activity expanded in March, with the official purchasing managers index rising to 50.4 from 49 in February, marking the strongest reading in a year and ending two months of contraction.
- Despite the positive data, analysts warn that the full impact of the Iran war, particularly rising energy costs and supply chain disruptions, has yet to be felt and could weigh on China’s economic growth.
- China’s export-driven growth faces risks due to potential prolonged disruptions in Middle East energy supplies and higher global inflation, which could reduce demand for Chinese goods.
- The country’s economic growth target for 2023 is set at 4.5% to 5%, the lowest since 1991, reflecting cautious optimism amid ongoing challenges like the property sector slump and trade tensions.
- Economists are monitoring trade relations with the U.S., with hopes that a planned meeting between President Trump and Xi Jinping and a recent Supreme Court ruling against broad U.S. tariffs might provide a modest boost to Chinese exports.
