Economists said the country’s property crisis continued to weigh on confidence among households and businesses, as non-manufacturing activity also slowed.
The National Bureau of Statistics (NBS) said its official manufacturing purchasing managers’ index (PMI) fell to 49.5 in May from 50.4 in April. This is below analysts’ forecasts and under the 50 threshold that divides growth from contraction.
Xiangrong Yu, an economist at Citi, said the closely watched survey suggested the world’s second-largest economy was in the grip of a deeper malaise.
“Persistent demand weakness seems to [be] eroding production strength,” he said.