China's June manufacturing growth shows signs of slowdown

China, the world's second-largest economy's recorded its lowest growth in manufacturing in two and a half years in June as a result of  10 months of consecutive tightening measures adopted by the government to rein in inflation and the asset price bubbles.

The Purchasing Managers' Index (PMI) fell to 50.9 in June compared with 52 in May, the China Federation of Logistics and Purchasing said in a statement today.

This data indicates a sizable slowdown in the country's manufacturing growth and suggests economic growth is likely to continue to slow, as the ruling Communist Party of China has gathered to celebrate 90 years of its founding.

The PMI is a key an indicator of conditions in the manufacturing sector, which is a big contributor to China's economic growth.

A reading above 50 indicates the sector is expanding while a reading below 50 indicates contraction.

Even though the data released is slightly above the threshold level of 50, indicating growth in few sectors, the fall from the May figures shows that economic growth is slowing.