China’s manufacturing activity contracted again in November as production weakened and demand slowed, according to both official and private surveys, signaling worsening conditions in the world’s second-largest economy.

The RatingDog China Manufacturing Purchasing Managers’ Index (PMI) unexpectedly fell to 49.9, slipping below the 50-point level that separates growth from contraction for the first time in four months.

The reading came despite signs of stronger overseas demand following a temporary easing of trade tensions with the United States.

Exports have yet to recover. Bloomberg reports that shipments unexpectedly contracted in October as global demand failed to offset steep declines in sales to the U.S., after the latest escalation in tensions with the Trump administration.

Industrial firms also saw their profits fall for the first time in three months during the same period.

The official PMI, published by the National Bureau of Statistics, remained in contraction for an eighth straight month the longest downturn on record though the decline moderated slightly.

The extended weakness comes amid mounting concerns about China’s fading post-pandemic recovery.

The RatingDog survey showed manufacturers cutting staffing levels as new orders slowed to nearly flat. Business confidence, however, ticked up slightly from October. Notably, both the private and official PMIs which measure differing segments of the manufacturing sector pointed to contraction, underscoring the breadth of the slowdown.

Taken together, the data paints a picture of an economy losing momentum into the final quarter of the year. Investment is weakening, while consumer demand remains fragile.

Retail sales growth in October slowed for the fifth consecutive month, the longest stretch of decline since the height of the Covid-19 pandemic over four years ago.

Even so, Beijing insists its full-year growth target of around five percent remains achievable. Authorities have rolled out close to one trillion yuan in new stimulus measures since late September, aimed at shoring up confidence in factories, property, and local government spending.

“Although new export orders picked up in November, this trend failed to reverse the sluggish state of the manufacturing sector,” said Yao Yu, founder of RatingDog, in a statement cited by Bloomberg.

With global demand uncertain and domestic consumption still under strain, analysts warn that China’s factories face a difficult close to the year and a challenging start to the next one.