This photo taken on May 3, 2018 shows a worker cutting steel at a factory in Huaibei in China's eastern Anhui province. - China's surplus with the United States widened in April, underlining an imbalance between the economic titans as they struggle to reach an agreement on averting a potentially damaging trade war. (Photo by - / AFP) / China OUT (Photo credit should read -/AFP/Getty Images)
- | AFP | Getty Images
China's manufacturing activity contracted more than expected for in the month of May amid a bitter trade war with the U.S.
The official manufacturing Purchasing Managers' Index (PMI) for May came in at 49.4, lower than the 49.9 economists polled by Reuters had forecast. April's reading was 50.1.
PMI readings above 50 indicate expansion, while those below that signal contraction.
The PMI is a survey of businesses about the operating environment. Such data offer a first glimpse into what's happening in an economy, as they are usually among the first major economic indicators released each month.
For China, the PMI is among economic indicators that investors globally watch closely for signs of trouble amid domestic headwinds and the ongoing U.S.-China trade dispute.
The official PMI survey typically polls a large proportion of big businesses and state-owned enterprises. A separate survey, the Caixin indicator has a bigger mix of small- and medium-sized firms.
The Caixin manufacturing PMI is due on June 3.
CNBC's Yen Nee Lee Reuters contributed to this report.
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