Oil price slides further as China manufacturing contracts

 
Emma Haslett
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Although the sector contracted, manufacturing fell less than originally thought (Source: Getty)

China's manufacturing sector contracted for the first time during December, new figures published this morning showed.

HSBC/Markit's China manufacturing PMI fell to 49.6, below the 50-mark which indicates a fall, and down from 50 in November.

However, the figure was revised up from an initial "flash" reading earlier in the month, which was 49.5.

Last week, the country's National Bureau for Statistics said profits in its industrial sector fell 4.2 per cent to 676.12bn yuan (£69.8bn) in November, its biggest annual decline since August 2012.

China's central bank has already cut interest rates to 2.75 per cent in an attempt to rejuvenate the economy, but analysts suggested more weak manufacturing data might herald further attempts at easing pressure.

Honbin Qu, chief economist for China at HSBC, said:

We believe that weaker economic activity and stronger disinflationary pressures warrant further monetary easing in the coming months.

The news pushed oil prices down further, with Brent Crude falling 79 cents to $57.11. Brent has now plummeted by almost 49 per cent since June.

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