FACTORY activity in China shrank in August for the fourth month in a row as the United States ramped up trade pressure and domestic demand remained sluggish, pointing to a further slowdown in the world’s second largest economy.

The Purchasing Managers’ Index (PMI) fell to 49.5 in August, the National Bureau of Statistics said Saturday, versus 49.7 in July, below the 50-point mark that separates growth from contraction on a monthly basis.

Export orders fell for the 15th straight month in August, although at a slower pace, with the sub-index picking up to 47.2 from July’s 46.9.

Total new orders — from home and abroad — also continued to fall, indicating domestic demand remains soft, despite a flurry of growth-boosting measures over the past year.

“Frontloading of exports to the United States ahead of higher tariffs supported trade and overall activity growth, but this effect will likely fade in the next few months,” said analysts at Goldman Sachs in a note.

Manufacturers in consumption-oriented industries such as the auto sector have been especially vulnerable. Carmakers such as Geely and Great Wall have slashed expectations for sales and profits.

The data showed activity at medium and small-sized firms contracted, even as large manufacturers, many backed by the government, managed to expand in August.

Factories continued to shed jobs in August amid the uncertain business outlook. The employment sub-index dropped to 46.9, compared with 47.1 in July.

Growth in China’s services sector activity picked up for the first time in five months in August, with the official numbers from a separate business survey rising to 53.8 from 53.7 in August.(SD-Agencies)