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China's manufacturing sector has slowed to its slowest pace since February 2009 according to official figures. The sector has been hit by the weak export to debt-troubled Europe, as well as domestic efforts to curb inflation by cutting bank lending and raising interest rates. Experts say they expect the Chinese economy to slow further in the months to come.
China's Purchasing Managers Index, which shows manufacturing activity, slowed from 51.2 in September to 50.4 in October—showing manufacturers were expanding at their slowest pace since February 2009.
The China Federation of Logistics and Purchasing compiled the data. Many economists who were expecting an increase were caught by surprise.
New orders and the level of production both fell to just over 50, which demarcates expansion from contraction.
But new export orders fell the most to 48.6, leading economists to blame the debt turmoil in Europe—China's largest export market.
Zhang Liqun from the Development Research Center of the State Council said the figures suggested the economy would slow more in the future.
The findings will strengthen calls for a selective easing of monetary policy as authorities walk a fine line between reducing inflation and damaging growth. Last week Chinese leader Wen Jiabao said monetary policy could be "fine tuned" as needed.
But other analysts were more optimistic, with a similar index released by the private sector on the same day showing manufacturing increased to 50 from 49.9, which was the first rise since June.