Chinese manufacturing experienced its fourth straight month of contraction last month, exceeding expectations and highlighting the challenges faced by the world's second-largest economy in its recovery efforts.

China's National Bureau of Statistics reported that the purchasing managers’ index, a crucial gauge of industrial production, was at 49.1 points in the previous month. This indicates a more significant decline than the one seen in July (49.4 points) for the index, which relies partially on company order books.

A number greater than 50 shows growth in manufacturing, while below 50 shows decline. Analysts surveyed by Bloomberg expected a drop for the previous month, but a smaller one of 49.5.

China has experienced a short and less strong recovery following the pandemic than anticipated. Although certain industries like tourism and the automotive sector have fully recovered, real estate, a crucial factor for growth, is still facing challenges.

In the middle of August, China issued a set of economic indicators that were considered unsatisfactory despite recent efforts by the government to increase growth. The residential housing market in the country worsened last month due to predictions of a continued decrease in new-home prices, hindering efforts to soften the economic decline.

Preliminary data released by China Real Estate Information Corp on Saturday showed that the value of new-home sales from the top 100 real estate companies decreased by 26.8 percent to 251 billion yuan (US$35.4 billion) compared to the previous year, surpassing the 19.7 percent drop in July.