Manufacturing activity in China slowed in May as government moves to stop the economy from overheating kicked in.
The HSBC China Manufacturing purchasing managers index fell to 52.7 last month from a revised figure of 55.2 in April, an 11-month low, indicating the recovery of China's manufacturing sector lost some momentum, the bank said. A reading above 50 means the sector is expanding, while a figure below 50 indicates an overall decline.
A separate survey released by a government agency today showed manufacturing activity had dropped to 53.9 in May from 55.7 in April.
HSBC's results are based on interviews with purchasing managers at over 400 companies, while the survey by the China Federation of Logistics and Purchasing covers more than 700 firms.
The government survey predicted the Chinese economy would continue to grow rapidly, but at a moderately slower pace.
Asian shares were lower today amid concerns that growth of the world's third-largest economy may slow down, impeding the region's recovery as China is a major export destination for several regional economies.
Beijing has announced a series of measures to rein in bank lending to calm inflationary pressures and avoid a damaging bubble in the property market. China's economy grew a blistering 11.9% in the first quarter of 2010, fuelling fears the booming economy was at risk of overheating.
