Factory activity in Asia weakened in September, with many trade- reliant economies seeing a slump in export orders in a sign that escalating U.S.-China tensions are taking a toll on business confidence, Reuters reports.
Rising raw material costs are also squeezing profit margins for Asian manufacturers, raising questions over future investment and reinforcing views that global economic growth is shifting into lower gear.
Business surveys released on Sunday and Monday pointed to deteriorating conditions across much of the region in September, with gauges of future activity offering little hope for a turnaround in the next few months.
Some of the immediate gloom will be dispelled by news that the United States and Canada had clinched a last-gasp deal on Sunday to salvage the North American Free Trade Agreement (NAFTA), removing one major near-term risk to the global outlook.
But that did little to ease concerns in Asia over further signs of cooling in China’s economy and the risk of collateral damage for its neighbors as the trade war between Washington and Beijing grinds on.