China's factory activity contracted at the fastest pace in 16 months in April, a factory survey showed on Wednesday, keeping alive calls for further stimulus as Donald Trump's "Liberation Day" package of tariffs snapped two months of recovery.

China's manufacturing activity fell more than expected to a near two-year low, sliding into contractionary territory in April as the escalating trade war with the U.S. hurts bilateral trade. The official purchasing managers' index came in at 49.

China’s factory activity slipped into the worst contraction since December 2023, revealing early damage to the world’s second-biggest economy from the trade war with the US.