BEIJING (Reuters) – China’s factory activity unexpectedly shrank in September as high raw material prices and power cuts continued to pressure manufacturers in the world’s second-largest economy.

According to data from the National Bureau of Statistics, the PMI (official manufacturing Purchasing Manager’s Index) fell into contraction on Thursday for the first-time since February 2020.

An Reuters poll found that the index was expected to stay steady at 50.1, which is the same value as last month.

A 50-point threshold is the mark that separates growth and contraction.

China’s economy recovered quickly from last year’s pandemic-induced slump, however momentum has declined in recent months due to the large manufacturing sector being affected by COVID-19, increased costs, production bottlenecks and, more recently, electricity shortages.