China's official manufacturing PMI dropped to 49% in April, the biggest decline in 16 months, signalling growing economic pressure. SMU Associate Professor of Finance Fu Fangjian analysed that this data reflects the gradual impact of the trade war. However, he believes the Chinese government is unlikely to resort to broad interest rate or reserve requirement cuts and is more likely to introduce targeted support policies for industries and enterprises that are severely affected. He believes that although the manufacturing sector is contracting, this will not weaken China's stance in its competition with the US, as the country's societal foundation remains stable, and its citizens tend to be more tolerant and resilient.
