China lockdowns reduce Asia’s factory activities

• Slowing global demand and uncertainty regarding China’s COVID-19 lockdowns hurt factory output across Asia.
• The result lowered fourth-quarter employment and economic growth for the region.
• Manufacturing activity also fell in export-reliant economies like Japan and South Korea.

Slowing global demand and uncertainty regarding China’s COVID-19 lockdowns hurt factory output across Asia in November.

The lockdowns hamper international supply and heighten fears of a deeper decline in Asia’s economy, the world’s second-largest.

In November, China’s industry activity fell under pandemic restrictions, a private study found. The consequence lowered fourth-quarter employment and economic growth.

Manufacturing activity also fell in export-reliant economies like Japan and South Korea and rising nations like Vietnam, polls show. Weak global demand and high input costs are wreaking havoc.

Cooling market conditions, cost constraints, and weak underlying demand contributed to the declines, said S&P Global Market Intelligence economist Laura Denman.

In November, China’s Caixin/S&P Global manufacturing PMI was 49.4, up from 49.2 in October but still below the 50 line that distinguishes growth from contraction. Four months below 50.

Wednesday’s official survey showed manufacturing activity at a seven-month low in November.

Japan’s au Jibun Bank PMI decreased to 49.0 from 50.7 in November. Since November 2020, no contraction.

South Korea’s factory activity fell for a fifth straight month in November, although the decline slowed, suggesting the worst is past.

South Korea’s exports in November suffered their biggest annual loss in two and a half years, separate data showed Thursday, hurt by cooling global demand led by China and a contraction in the semiconductor industry.

Lockdowns in China have affected Apple’s largest manufacturing. Many cities have seen uncommon street protests.

Asia felt China’s problems. Taiwan’s November PMI was 41.6, up from 41.5 in October but still below 50.

Vietnam’s PMI decreased to 47.4 in November from 50.6 in October, while Indonesia’s dipped to 50.3 from 51.8.

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