China’s factory activity contracted in May, according to an official survey released on Saturday, although the decline slowed from April as the country reached a deal with the U.S. to slash President Donald Trump's sky-high tariffs.

China’s factory activity contracted at a slower rate in May after a reprieve in the tariff war with the US unclogged trade flows, even as weak domestic demand continues to weigh on the economy.

Trump's former ambassador to Vietnam highlighted the main reason China may hesitate to strike a trade deal with the U.S.

But a U.S. official told Reuters that it appears China was moving slowly on promises to issue export licenses for rare earths minerals. The deal called for China to lift trade countermeasures that restrict its exports of the critical metals needed for U.S. semiconductor, electronics and defense production.

U.S. President Donald Trump on Friday said China had violated an agreement on tariffs with the United States. "China, perhaps not surprisingly to some, HAS TOTALLY VIOLATED ITS AGREEMENT WITH US. So much for being Mr.

JPMorgan Chase CEO Jamie Dimon sounded a warning Friday on the fractious US relationship with China — and on “the enemy within.”