Factory activity in China unexpectedly contracted in July, with the official manufacturing Purchasing Managers' Index (PMI) coming in at 49.2, according to data from the National Bureau of Statistics released on Friday.
A reading above 50 indicates expansion, while a figure below signals a contraction.
The latest print missed the consensus forecast of 50.1 tracked by Investing.com, and compared with the 50.3 recorded in the previous month. It marked the first contraction in manufacturing activity since February.
By enterprise size, the PMI for large-sized enterprises fell to 49.5 from 50.7 in June, while the indices for medium and small-sized enterprises edged down to 49.7 and 47.4, respectively.
All sub-indices were in negative territory in July, with the new orders index slipping to 48.5 from 51.2, the inventory index falling to 48.3 from 48.4, and the employment index edging up to 49 from 48.5. The supplier delivery time index came in at 49.5, down from 49.9 in June.