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China factory measure improves but activity still sluggish

January 31, 2019
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In this Jan. 19, 2019, photo, worker checks on a copper foil machines at a factory in Jiujiang in central China's Jiangxi province. An official measure of China's manufacturing improved in January but forecasters say economic activity is sluggish as Chinese leaders try to resolve a tariff battle with Washington. (Chinatopix via AP)

BEIJING (AP) — China’s manufacturing improved in January, a survey showed Thursday, but forecasters said activity remains sluggish as Beijing tries to resolve a tariff battle with Washington.

The purchasing managers’ index issued Thursday by the government statistics agency and an industry group rose 0.1 points on a 100-point scale but stayed below a level that shows activity expanding.

Measures for employment and domestic demand weakened.

China’s economic growth sank to a three-decade low of 6.6 percent in 2018 after activity in the final quarter of the year dipped to its lowest level since the 2008 global crisis.

“We see economic growth remaining sluggish” through mid-2019, Citigroup economists said in a report. “We believe the government will step up efforts to keep the labor market stable.”

Chinese and U.S. negotiators began talks Wednesday in Washington aimed at resolving the fight over U.S. complaints about Beijing’s technology ambitions.

Communist leaders are trying to steer China to slower, more self-sustaining growth based on consumer spending instead of trade and investment.

But the deceleration has been sharper than expected, prompting Beijing to step up government spending and order banks to lend more to shore up growth and avoid politically dangerous job losses.

Update hourly