The mainland's manufacturing activities may contract in January for the third straight month, according to data suggesting Beijing could implement more policies to stabilise economic growth.
The HSBC/Markit flash purchasing managers' index (PMI), a monthly indicator published before official data is released, stood at 48.8 in January, indicating contraction. A value higher than 50 indicates expansion.
The figure, however, showed a slight improvement from the PMI in December, which was 48.7, and put the indicator at a three-month high.
'This suggests a relatively weak growth momentum of manufacturing activities, despite the upside surprise of December industrial production growth due to the front-loaded production ahead of the early Chinese New Year,' HSBC's chief China economist Qu Hongbin and analyst Sun Junwei said in the report.
The sub-index for new export orders rebounded to 51.1 in January, ending the contraction, at 49.7, in December. However, total new orders still contracted despite climbing to a three-month high of 49.7 this month from 46.9 in December.
The surge in new orders failed to boost production, which decelerated at a faster pace to 47 in January, compared with 49.5 in December, the report said.