Xi Jinping says "we must enhance the effectiveness of macroeconomic policies" amid weak factory data

New data released Friday showed China’s factory activity unexpectedly contracted in July, with a key manufacturing index falling to 49.2 from 50.3 in June—below the 50 threshold separating growth from shrinkage and short of the 50.1 forecast. A companion gauge covering services and construction dropped to 49.0, its steepest decline in more than three years. Weak household consumption and the prolonged property downturn have made overseas sales a crucial support, though Middle East turmoil has raised shipping and energy costs. A day after the figures, President Xi Jinping acknowledged economic difficulties and, according to Xinhua, urged officials to strengthen economic-management measures and prioritize consumer demand at home. The Politburo had already pressed local governments to increase spending. China’s second-quarter growth was 4.3%, the weakest in over three years, against a 4.5–5.0% annual target.