Activity in the Chinese manufacturing sector improved slightly in April but remains in contractionary territory, a private survey shows.
HSBC's flash China manufacturing purchasing managers' index edged up to 48.3 points in April, compared with 48.0 in March.
A reading above 50 indicates the sector is expanding, while a print below 50 shows the sector is contracting.
HSBC China chief economist Hongbin Qu said domestic demand showed mild improvement and deflationary pressures eased in the month.
"But downside risks to growth are still evident as both new export orders and employment contracted," Mr Qu said.
The release of new official measures to support growth and employment after the release of first-quarter GDP will likely have limited initial impact but signal readiness to do more if necessary, he said.
"We think more measures may be unveiled in the coming months and the People's Bank of China will keep sufficient liquidity."
