China's factory activity shrinks for second straight month, contracting less than expected

China's manufacturing activity in August shrank for a second straight month, though by less than market estimates, keeping the pressure on Beijing to support the economy as growth loses momentum. The official purchasing managers' index came in at 49.8, compared with 49.2 in July, National Bureau of Statistics data showed Monday, better than Reuters-polled economists' forecast of 49.6. China's economy has come under mounting strain, with growth slowing to 4.3% in the second quarter, the weakest pace since late 2022, as soft domestic demand and a prolonged property slump continue to weigh on activity. The economic malaise deepened further in the second half this year, as consumer spending stalled, urban investment contracted at a faster pace, and unemployment ticked higher. Retail sales and industrial output both slowed in July, while growth in industrial profits cooled to its weakest pace this year. Exports have been one of the few pillars propping up growth this year, cushioning some of the drag from external shocks as a global boom in AI infrastructure spending lifts demand for Chinese-made tech goods. Outbound shipments recorded double-digit growth for most of this year. Chinese policymakers have pledged to roll out new policy measures in a timely manner and flagged room for further fiscal spending and monetary easing. But economists said the scale of any upcoming support will likely be limited. This is breaking news. Please refresh for updates.