Manufacturing Slows Across Asia : Asian Factories
- Factory activity shrank in most Asian countries in June due to uncertainty over U.S. tariffs.
- Despite some signs of recovery, global demand remains weak.
Country-wise Snapshot
China
- Caixin Manufacturing PMI rose to 50.4 (up from 48.3 in May), indicating modest growth.
- Contrasts with official PMI, which showed contraction for the third straight month.
- Economist Wang Zhe warns that domestic demand remains weak, and global uncertainty persists.
Japan
- Manufacturing expanded for the first time in 13 months (PMI at 50.1).
- New orders fell due to tariff-related uncertainty.
South Korea
- PMI at 48.7 (contracted for 5th month), but decline slowed post-snap presidential election.
- Exports rebounded overall, but shipments to the U.S. and China remain weak.
Indonesia
- PMI fell to 46.9 from 47.4 (continued contraction).
Vietnam
- PMI dropped to 48.9 from 49.8 (worsening conditions).
Malaysia
- PMI slightly improved to 49.3 from 48.8, still below growth threshold.
Taiwan
- PMI declined to 47.2 from 48.6 (deepening contraction).
Trade Talks & Tariff Pressure
- Tariffs from President Trump have increased global trade uncertainty.
- Over a dozen countries are rushing to strike deals with the U.S. by July 9 to avoid higher import tariffs.
- China is still negotiating, but Japan and South Korea have not secured tariff relief, especially for autos.
Outlook
- Analysts expect volatility in U.S. trade policy to continue in the second half of 2025.
Weak demand and policy uncertainty are likely to continue weighing on Asia’s (Asian Factories) export-driven economies.
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