Chinese factory activity improves slightly with delay on tariffs, but
still lags
[June 30, 2025] By
ELAINE KURTENBACH
BANGKOK (AP) — Chinese factory activity improved somewhat in June after
President Donald Trump agreed to delay imposing higher tariffs on
imports from China for 90 days, but overall activity was still
contracting, according to a survey released Monday.
The purchasing managers index, which reflects new orders and other
measures, rose to 49.7 from 49.5 in May, the National Bureau of
Statistics reported. That’s on a scale of 0 to 100 where 50 and above
shows expansion.
Other reports showed similar trends in Japan and Korea.
Trump has said he’s not planning to extend the 90-day pause on tariffs
on most nations beyond July 9. The delay for imposing much higher
tariffs on China, agreed to in early May, expires about a month later.

The hiatus for tariffs brought a revival of manufacturing activity as
companies and individuals rushed to take advantage of lower import
duties. But that mainly helped large manufacturers, with small and
mid-size companies' output still contracting. Hiring also fell.
New export orders and exports also remained below the 50-level that
marks expansion.
In Japan, manufacturing output edged 0.5% higher in May, well below
analysts' estimates for a 3.5% increase.
“The subdued rise in industrial production in May means that firms were
not benefitting from sky-high U.S. tariffs on Chinese imports, and their
production forecasts point to continued weakness,” Marcel Thieliant of
Capital Economics said in a report.
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 South Korea's government reported
that its “all industry” measure of output fell 2.9% from a year
earlier in May, with production of computer chips falling 2%.
Production of vehicles fell 2.3% year-on-year, after falling 4.1% in
April.
In an interview with Fox News Channel's “Sunday
Morning Futures,” Trump said he’s not planning to extend a 90-day
pause on tariffs on most nations beyond July 9. The delay for
imposing much higher tariffs on China, agreed to in early May,
expires about a month later.
Trump said his administration will notify countries that the trade
penalties will take effect unless there are deals with the United
States. He had played down the deadline at a White House news
conference Friday by noting how difficult it would be to work out
separate deals with each nation. The administration had set a goal
of reaching 90 trade deals in 90 days.
Despite a recent trade deal with Beijing over rare earth exports
from China, establishing a fairer relationship will require
significant tariffs.
Details of the latest agreement to deescalate trade tensions are
scarce and major issues between the world’s two biggest economies
remain unresolved.
“I think getting along well with China is a very good thing,” Trump
said. “China’s going to be paying a lot of tariffs, but we have a
big (trade) deficit, they understand that.”
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