It will be interesting to see in coming days how China works to recover its economy as a preliminary private survey showed that China’s factory sector contracted by the most in 15 months as shrinking orders depressed the country’s output. The result comes on the heels of a stock market crash which began in June. Though it is too early to say that how will it affects Chinese Textile industry. China is the world’s number one textile exporter, valued its exports at close to US $ 274 Billion close to seven times that of India.
According to the survey, economists had forecast a reading of 49.7, slightly stronger than June’s final reading of 49.4. Output in July was 47.3, its lowest since March 2014. New orders and new export orders, both of which expanded in June, fell this month. The flash Caixin/Markit China Manufacturing Purchasing Managers’ Index (PMI) dropped to 48.2, the lowest reading since April last year and a fifth straight month below 50, the level which separates contraction from expansion. Weaker foreign demand is one of the reasons for current situation of China. On the other hand, Chinese shares were down more than 8 per cent in biggest one-day drop since 2007.
