China’s official manufacturing PMI fell to 49.2 in July from 50.3 in June, marking the first contraction in five months and missing economist forecasts of 50.0. The private S&P Global/Caixin PMI confirmed the downward trend at 49.5, while new orders plunged to 48.5, their weakest reading since 2023. This weakness stems from softening domestic demand, the unwinding of tariff-related front-loading activity, and geopolitical tensions in the Middle East pushing input costs higher. A weaker yuan, which often accompanies economic softness, has historically correlated with increased capital flight into alternative stores of value such as Bitcoin.
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