Group 1: PMI Trends - July manufacturing PMI decreased to 49.3%, down 0.4 percentage points from the previous value, indicating a contraction for the fourth consecutive month[2] - Non-manufacturing PMI fell to 50.1%, a decline of 0.4 percentage points, with service and construction sectors dropping by 0.1 and 2.2 percentage points respectively[2] - Composite PMI output index decreased by 0.5 percentage points to 50.2%, suggesting a slowdown in overall economic expansion[2] Group 2: Supply and Demand Signals - July PMI production index was 50.5%, down 0.5 percentage points, indicating continued expansion but with weakening demand[3] - New orders index fell by 0.8 percentage points to 49.4%, entering contraction territory, with new export orders down by 0.6 percentage points[3] - New export orders index dropped to 47.1%, remaining in contraction, while import orders held steady at 47.8%[3] Group 3: Price and Employment Insights - Price indices rebounded, with raw material and factory price indices rising by 3.1 and 2.1 percentage points respectively, indicating a narrowing decline in PPI[4] - Employment pressure eased slightly, with manufacturing, service, and construction employment indices increasing by 0.1, 0.0, and 1.0 percentage points respectively[4] - Service sector PMI fell to 50.0%, while construction PMI dropped 2.2 percentage points to 50.6%, the second-lowest this year[6] Group 4: Economic Outlook - The July Politburo meeting indicated a focus on policy implementation, with potential new policies expected but not strong stimulus measures[6] - Economic pressures are anticipated to increase in the second half of the year, particularly in August and September, due to prior "export rush" effects and short-term contraction[6] - Continued monitoring of US-China trade negotiations is advised, as potential developments may impact market conditions[6]

Group 1: PMI Overview - In July 2025, the manufacturing PMI decreased to 49.3%, down 0.4 percentage points from the previous month, indicating a decline in manufacturing activity[1] - The construction business activity index was at 50.6%, down from 52.8%, while the services business activity index remained stable at 50.0%, slightly down from 50.1%[1] Group 2: Production and Demand Factors - The production index for July was 50.5%, down from 51%, while the new orders index fell to 49.4% from 50.2%, indicating a contraction in new orders[2] - Extreme weather events in July, including heavy rains and heatwaves, impacted outdoor construction activities, contributing to the decline in production and new orders[2] - Passenger car sales dropped by 21.9% month-on-month in July, reflecting weakened consumer demand post the June shopping festival[2] Group 3: Price Indices and Inventory - The PMI output price index rose by 2.1 percentage points to 48.3%, and the raw material purchase price index increased by 3.1 percentage points to 51.5%, indicating rising input costs[3] - The gap between raw material prices and finished product prices widened to 3.2 percentage points, up from 2.2 percentage points, which is detrimental to corporate profit recovery[3] - The inventory indices for finished goods and raw materials both declined, with finished goods at 47.4% and raw materials at 47.7%, indicating a contraction in inventory levels[4] Group 4: Business Sentiment and Future Outlook - Small enterprises faced significant pressure, with their PMI dropping to 46.4%, while large and medium enterprises saw slight increases[4] - The outlook for future demand remains cautious, with businesses responding primarily to short-term orders and maintaining low inventory levels[5] - The political bureau meeting emphasized consolidating economic recovery and addressing prominent issues, with a focus on nurturing emerging industries and avoiding debt-driven growth[5]

Core Viewpoint - The "anti-involution" policy has boosted prices, but supply and demand performance is counterintuitive [2][7][67] - The manufacturing PMI decreased by 0.4 percentage points to 49.3%, exceeding the average decline since 2017 [2][67] - The increase in commodity prices is reflected in the raw material purchase price index (+3.1 percentage points to 51.5%) and the factory price index (+2.1 percentage points to 48.3%) [2][67] Manufacturing Sector - The manufacturing PMI has marginally declined, with production and new order indices both decreasing [4][70] - The production index fell by 0.5 percentage points to 50.5%, while the new order index dropped by 0.8 percentage points to 49.4% [4][70] - The new export order index decreased by 0.6 percentage points to 47.1%, indicating a slowdown in market demand [4][70][35] Key Industries - High-energy-consuming industries are showing production strength despite price increases, with the steel industry PMI rising by 4.6 percentage points to return to the expansion zone [3][18][69] - The equipment manufacturing and consumer goods industries saw PMIs decline by 1.1 and 0.9 percentage points to 50.3% and 49.5%, respectively [3][18][69] - Investment demand weakened significantly, contrasting with the strong production performance in high-energy-consuming sectors [21][69] Non-Manufacturing Sector - The non-manufacturing PMI decreased by 0.4 percentage points to 50.1%, primarily due to a significant drop in the construction PMI [42][70] - The construction PMI fell by 2.2 percentage points to 50.6%, with the new order index dropping sharply by 2.2 percentage points to 42.7% [5][58][70] - The service sector PMI slightly declined, with the new order index remaining weak at 46.3% [5][46][70] Future Outlook - The political bureau meeting in July emphasized the need for further implementation of the "anti-involution" policy, focusing on the effects in downstream sectors and marginal changes in domestic demand [27][69] - The current situation indicates that the "anti-involution" policy in the upper reaches still requires further advancement, while high-energy-consuming industries are undergoing significant transformations [27][69]

Group 1: PMI Data Overview - In July, the manufacturing PMI decreased by 0.4 percentage points to 49.3%, while the non-manufacturing PMI fell by 0.4 percentage points to 50.1%[6][28] - The decline in manufacturing PMI is greater than the average drop of 0.1 percentage points since 2017[7][28] - The purchasing price index for major raw materials rose by 3.1 percentage points to 51.5%, marking the first increase above the critical point since March[7][18] Group 2: Sector Performance - The production index in July remained in the expansion zone at 50.5%, despite a 0.5 percentage point decline[2][13] - The new orders index fell into the contraction zone, decreasing by 0.8 percentage points to 49.4%[2][14] - High-energy-consuming industries, particularly the steel sector, saw a PMI increase of 4.6 percentage points, returning to the expansion zone at 48%[18][21] Group 3: Investment and Demand Trends - Investment demand weakened significantly in July, contrasting with the strong performance of high-energy-consuming industries[21] - The construction PMI dropped by 2.2 percentage points to 50.6%, with new orders falling sharply to 42.7%[21][42] - The business activity expectation index for the construction sector decreased by 2.3 percentage points to 51.6%[21] Group 4: Future Outlook - The political bureau meeting in July emphasized the need for further implementation of "anti-involution" policies, particularly focusing on mid- and downstream sectors[23] - The report suggests that the effectiveness of "anti-involution" policies in stimulating domestic demand will be crucial for future manufacturing performance[23]

Group 1: Economic Growth - In Q2, China's actual GDP grew by 5.2% year-on-year, with a target of around 5% for the full year, indicating manageable pressure to meet this goal[3] - The GDP deflator index fell to -1.2% in Q2, marking the ninth consecutive quarter of negative growth, suggesting ongoing price pressures[9] - The contribution of consumption to GDP growth in Q2 was 2.7 percentage points, making it the primary driver of economic expansion[10] Group 2: Industrial Performance - In June, the industrial added value of large-scale enterprises increased by 6.8% year-on-year, exceeding expectations of 5.5%[15] - The export delivery value of large-scale industrial enterprises rose by 4% in June, a 3.4 percentage point increase from the previous value[15] - Key sectors such as automotive manufacturing and electronic equipment manufacturing saw year-on-year growth rates of 11.4% and 11.0%, respectively[15] Group 3: Investment Trends - From January to June, fixed asset investment growth slowed to 2.8%, down 0.9 percentage points, with significant declines in manufacturing and infrastructure investment[21] - Manufacturing investment growth decreased to 7.5%, while infrastructure investment fell to 8.9%, with real estate investment declining by 11.5%[21] - Water management sector investment growth dropped significantly, down 11.2 percentage points to 15.4% year-on-year[25] Group 4: Consumer Spending - In June, the total retail sales of consumer goods grew by 4.8% year-on-year, a decline of 1.6 percentage points from the previous month[29] - Restaurant revenue in June recorded a year-on-year increase of only 0.9%, a drop of 5 percentage points from the previous value[29] - The retail sales of household appliances and communication equipment fell by 20.6% and 19.1%, respectively, indicating weakening consumer demand[29] Group 5: Risk Factors - Potential risks include changes in the external environment and the possibility that the "old-for-new" policy may not meet expectations[34]

1. Report Industry Investment Rating No relevant information provided. 2. Core Viewpoints of the Report - In July 2025, extreme weather affected the release of downstream demand, causing a decline in new orders and production, with demand sub - items returning to the contraction zone. However, there were also increasing positive factors such as rising price indicators and improved macro - confidence. For the bond market, attention should be paid to the seesaw effect between data verification and risk - preference boosting, and the transmission effect of "strong expectations" to reality after August [4][10][11]. 3. Summary by Related Catalogs 3.1 Manufacturing PMI: Weather Factors Disturb, and the Boom Declines Temporarily 3.1.1 Supply and Demand: Demand Declines More Than Production - Production slowed down, with a month - on - month decrease of 0.5 pct to 50.5%. Factors included the weakening of the June rush - to - deliver effect, extreme high - temperature weather affecting demand and restocking, and industry "anti - involution" measures [2][16]. - New orders fell into the contraction zone, with a month - on - month decrease of 0.8 pct to 49.4%. The gap between new orders and new export orders narrowed to 2.3 pct, and domestic demand orders slowed more than export orders due to extreme weather [2][19]. 3.1.2 Foreign Trade: The Marginal Effect of "Rushing to Export" Weakens - New export orders declined month - on - month by 0.6 pct to 47.1%, and imports remained flat at 47.8%. The concentrated release of previous back - logged export orders in May - June weakened in July [2][22]. 3.1.3 Price: The Expectation of "Anti - Involution" and Rising Commodity Prices Lead to Accelerated Price Repair - The purchase price of raw materials and the ex - factory price increased by 3.1 pct and 2.1 pct month - on - month to 51.5% and 48.3% respectively. The increase was larger than in June, and it was expected that the PPI in July would improve marginally [2][27]. 3.1.4 Inventory: The De - stocking Rhythm Accelerates Relatively - Raw material inventory decreased by 0.3 pct month - on - month to 47.7%, and finished - product inventory decreased by 0.7%. Production restocking slowed down, and enterprises de - stocked faster [2][30]. 3.2 Non - manufacturing PMI: Construction Slows Down, and Service Consumption Differentiates Widely - In July, the non - manufacturing PMI was 50.1%, a month - on - month decrease of 0.4 pct. The service industry PMI decreased by 0.1 pct to 50.0%, and the construction industry PMI decreased by 2.2 pct to 50.6%. - The construction industry PMI declined due to the influence of the rainy season, with housing construction activities falling below the boom - bust line and civil engineering construction remaining above 55%. After the rainy season, there may be a rush - to - work effect, and the PMI is expected to recover. - The service industry PMI dropped to the boom - bust line. Retail and transportation industries were boosted by summer consumption, while the accommodation and catering industries had relatively weak demand growth [3][37].

7月31日，国家统计局发布中国采购经理指数（PMI）。数据显示，7月份，制造业PMI为49.3%，比上 月下降0.4个百分点；非制造业商务活动指数和综合PMI产出指数分别为50.1%和50.2%，比上月下降0.4 和0.5个百分点。 先来插播一个小科普：什么是PMI，这一指数有哪些作用？ PMI是通过对企业采购经理的月度调查结果统计汇总、编制而成的指数，涵盖企业采购、生产、流通等 各个环节，包括制造业和非制造业领域，是国际上通用的监测宏观经济走势的先行性指数之一，具有较 强的预测、预警作用。 当PMI高于50%时，反映经济总体较上月扩张；低于50%，则反映经济总体较上月收缩。 7月三大采购经理指数均较6月下降，怎么看？ 中国物流与采购联合会特约分析师张立群认为，7月份PMI指数在荣枯线下小幅下降，表明经济面临下 行压力。其中，订单类指数不同程度下降，以及受市场供求关系影响，生产指数、采购量指数均有回 落。价格类指数回升，企业生产经营活动预期指数提高，表明反内卷行动对企业预期有积极影响。 暑期假日效应带动相关服务业向好 7月份，非制造业商务活动指数为50.1%，比上月下降0.4个百分点，仍高于临界点。 中国物流 ...

Group 1 - The non-manufacturing sector is experiencing a slowdown in growth but remains in the expansion zone [1][7] - The non-manufacturing business activity index for July is at 50.1%, a decrease of 0.4 percentage points from the previous month [3] - The construction industry is facing a slowdown, with the business activity index at 50.6%, down 2.2 percentage points from last month [5] Group 2 - The service industry business activity index remains stable, with sectors related to travel and consumption showing strong performance, with indices above 60% [3][5] - The business activity expectation index for the service industry is above 55%, indicating optimism among most service enterprises regarding market prospects [5] - The overall expectation for non-manufacturing remains stable, with a business activity expectation index of 55.8%, an increase of 0.2 percentage points from the previous month [7]

Group 1: Report Industry Investment Rating - No relevant content provided Group 2: Report's Core View - In July, due to entering the traditional production off - season and factors like high - temperature, rainstorm and flood disasters in some areas, the business activities of enterprises slowed down. The three major PMIs declined but remained above the critical point, and the overall economic output in China continued to expand. However, demand was weak in the short - term, and production and price trends were complex. The export's role in driving the economy was expected to weaken in the second half of the year [2]. Group 3: Summary by Related Catalogs 3.1 Overall Economic Situation - China's official manufacturing PMI in July was 49.3% (expected 49.7%, previous value 49.7%); non - manufacturing PMI was 50.1% (expected 50.2%, previous value 50.5%); comprehensive PMI was 50.2% (previous value 50.7%). The three major indexes all declined, indicating a slowdown in economic prosperity, but the overall economic output remained in the expansion range [1]. 3.2 Investment - Real estate investment remained weak. Although sales and capital sources improved, investment - side policies were restricted. Infrastructure investment slowed down due to factors like high - temperature and flood disasters affecting construction progress, despite accelerated special bond issuance. Manufacturing investment slowed down but continued to grow at a high speed, and short - term restocking motivation of manufacturing enterprises declined [2]. 3.3 Consumption - The growth rate of consumption slowed down, but its driving effect on the economy remained strong [2]. 3.4 Export - Exports maintained resilience due to the mitigation of external shocks, but as the US restocking demand weakened in the future, export growth might slow down, and its driving effect on the economy was expected to weaken in the second half of the year [2]. 3.5 Manufacturing - The manufacturing PMI in July was 49.3%, lower than expected and the previous value. New order index and production index both declined, indicating a slowdown in market demand and a continued but decelerated expansion in production. New export order index declined, showing a slowdown in external demand, while import demand rebounded. Price indexes rebounded, and both finished - product and raw - material inventory indexes declined [3][4]. 3.6 Non - manufacturing - The non - manufacturing business activity index in July was 50.1%, still above the critical point. The service industry business activity index was 50.0%, slightly down. Some service - related industries were in a high - level prosperity range, while real estate and other industries had weak prosperity. The construction industry business activity index was 50.6%, down 2.2 percentage points. Most service enterprises were optimistic about the market, while the construction industry's market expectation declined [5]. 3.7 Comprehensive - The comprehensive PMI output index in July was 50.2%, down 0.5 percentage points from the previous month, indicating that overall business activities of enterprises in China continued to expand but at a slower pace [6].

Core Insights - The July Purchasing Managers' Index (PMI) data indicates a slight decline in China's manufacturing and non-manufacturing sectors, reflecting economic pressures [1][3][4] Manufacturing Sector - The manufacturing PMI for July is reported at 49.3%, a decrease of 0.4 percentage points from the previous month, indicating contraction [1][3] - The production index and new orders index are at 50.5% and 49.4%, respectively, showing a decline of 0.5 and 0.8 percentage points, suggesting a slowdown in market demand [5] - Despite the decline, the manufacturing sector shows resilience with high-tech and equipment manufacturing PMIs remaining above the critical point [5] Non-Manufacturing Sector - The non-manufacturing business activity index stands at 50.1%, down 0.4 percentage points from June, but still above the critical threshold [1][6] - The service sector remains stable, with a business activity index of 50.0%, slightly down by 0.1 percentage points [6] - The summer holiday effect positively influences service-related sectors such as transportation and entertainment, with indices exceeding 60.0% [6] Economic Outlook - Experts suggest that the fluctuations in the manufacturing PMI are primarily due to short-term factors, and the foundation for economic recovery remains solid [4] - The construction sector is experiencing a slowdown due to adverse weather conditions, but is expected to rebound as the rainy season ends [6][7]