China's Caixin Manufacturing PMI rose to 50.4 in June, returning to the expansion zone

The impact of the tariff war pause is gradually becoming apparent, driving the prosperity of China's manufacturing industry back to expansion after a brief contraction in May. On Tuesday, July 1st, data released by S&P Global showed that China's Caixin Manufacturing PMI for June was 50.4, an increase of 2.1 points from the previous month, and unchanged from April. The National Bureau of Statistics announced the June Manufacturing PMI the day before, recording 49.7, an increase of 0.2 points from the previous month, remaining in the contraction zone for three consecutive months. In terms of sub-indices, both the production index and new orders index returned to above the threshold line from the contraction zone, with the former reaching a seven-month high. The new export orders index, employment index, and raw material purchase price index all rose within the contraction zone. Despite improvements in production and demand, uncertainty still makes companies relatively cautious about increasing purchases, with the purchasing volume index dropping to a nine-month low within the contraction zone. Additionally, as production accelerates, the raw material inventory index fell from the expansion zone to the threshold line, leading companies to rely more on inventory to fulfill orders, causing the finished goods inventory index to drop into the contraction zone. Market competition is fierce, forcing manufacturers to lower prices for promotions, with the factory price index falling to a five-month low within the contraction zone; the production and business expectations index decreased within the expansion zone and is below the long-term average