Chinese Manufacturing Activity Declines

Two surveys show China's manufacturing weakened again in June amid a credit crunch and slower U.S. and European orders.

HSBC Corp. said Monday its monthly purchasing managers' index declined to 48.2 from May's 49.2 on a 50-point scale. Numbers below 50 show a contraction.

A separate measure by an industry group, the China Federation of Logistics and Purchasing, showed activity declined to 50.1 from May's 50.8.

Manufacturers were hurt by falling orders and a shortage of credit in June as Chinese regulators are trying to cool a lending boom they worry could race out of control.

A shortage of cash in financial markets caused interest rates paid by banks for loans from other banks to spike to a record high.