bodyType

customContents

entityId

entityUuid

articlePageQuery

filter

article

articleBaseAdvertisingInfoArticle

articleListArticle

articleSeoArticle

hooksArticleAcknowledgementGateOverlayArticle

hooksTrackPageViewArticle

hooksContentInterestArticle

articleLinkingDataContent

hooksAmpRedirectArticle

articleSchemaContent

liveArticle

advertZone

sentiment

contentLock

topics

types

sections

paywallTypes

createdDate

publishedDate

urlAlias

moreOnThisArticles

sponsorType

commentCount

authorLocations

authors

corrections

displaySlideShow

multimediaEmbed

printHeadline

seriesContainer

articleSpeeches

socialHeadline

headline

images

flag

firstTopic

glossary

flattenTypeIds

image

relatedLinks

relatedNewsletters

__typename

sponsor

pdfFiles

seriesReverseOrder

series

disableOffPlatformContent

published

updatedDate

summary

subHeadline

body

keywords

readingTime

customTimezone

liveContents

Xinyi Wu

China’s factory activity returned to expansionary territory in December – beating market expectations to end an eight-month contraction – but analysts said it might be premature to view the rebound as a sign of sustained stabilisation.
The manufacturing purchasing managers’ index (PMI) stood at 50.1 in December, up from 49.2 the previous month, according to data released on Wednesday by the National Bureau of Statistics.
The reading exceeded a projection of 49.6 from economists polled by the financial data provider Wind.
The monthly index compiles survey data given by supply chain managers from a variety of sectors. A reading above 50 suggests expansion, while one below 50 indicates contraction.
“Both production and demand rebounded significantly,” said Huo Lihui, chief statistician at the bureau’s service industry survey centre.
She added that stockpiling ahead of the holidays had bolstered the outlook for certain food and beverage-related industries.
The new orders sub-index – a measure of manufacturing demand – came in at 50.8 in December, up from 49.2 a month earlier and entering expansionary territory for the first time since the first half of 2025.
But new export orders continued to contract. A related sub-index posted a reading of 49 in December, a slight improvement from 47.6 the previous month.
“The situation is not as bad as manufacturers originally expected,” said Gary Ng, senior Asia-Pacific economist at French investment bank Natixis, noting that the boost from new orders was mostly driven by domestic demand.
He added that there was a “divergence” between sectors, with tech-related products and electronics seeing strong demand while performance in other sectors with tough competition and weaker demand, like metals, lagged.


While the PMI for hi-tech manufacturing rose by 2.4 points to 52.5, industries like ferrous metal smelting remained in contraction, indicating that those sectors still face certain pressures, according to Huo.
China’s exports have boomed this year despite a trade war with the United States – with its total goods trade surplus topping US$1 trillion for the first time – but Beijing has mostly struggled to gain traction in its pivot towards a consumption-driven growth model.
Momentum elsewhere in the economy has cooled towards the year-end, with consumption growth slowing further and fixed-asset investment, a traditional growth engine, slumping in November.
Despite the headwinds, authorities have held back from rolling out new policy easing as the consensus remains that Beijing is on track to meet its growth target of “around 5 per cent” for the year.
But some support appears to be on the horizon in 2026, as high-level policymakers have vowed to implement a more proactive fiscal policy to boost consumption and expand effective investment.
China’s non-manufacturing PMI, which measures activity in the construction and services sectors, rose to 50.2 in December from 49.5 last month, the bureau’s data showed.
Huo attributed the lift in the construction sector to higher-than-average temperatures in some southern provinces and a year-end rush to complete projects before the coming holidays.
“It could also be a sign that fiscal spending on infrastructure is picking up again after an abrupt slowdown in earlier months,” said Julian Evans-Pritchard, head of China economics at Capital Economics.
China’s official composite PMI – which tracks both the manufacturing and non-manufacturing sectors – stood at 50.7 in December, compared with 49.7 in November.
Evans-Pritchard said the improvement may prove to be a short-lived upturn in activity fuelled by fluctuating fiscal spending rather than the start of a sustained pickup, given that structural headwinds from the property downturn and industrial overcapacity were set to persist next year.
“Whether [the positive momentum] can continue still depends on government policies and whether it can end the ‘involution’ trend in giving firms more room for profit margins, as well as whether demand can recover further,” Ng said.


China’s factory activity breaks 8-month contraction, but headwinds persist

ByteDance to pour US$14 billion into Nvidia chips in 2026 as computing demand surges

China’s Shenzhen targets AI in ‘every household’ as US tech rivalry heats up

China’s lagging basic research demands core tech pivot as US curbs bite: economic adviser

China manufacturing

A major indicator of China’s factory activity returned to expansion in December, after eight straight months of contraction. Photo: AFP

China sharpens sales pitch for overseas investment with new list of sought-after sectors

China’s revised catalogue of encouraged industries has added many sectors, including medical equipment. Photo: CFOTO/Future Publishing via Getty Images

China’s revised catalogue of encouraged industries has added many sectors related to advanced manufacturing, including medical equipment. Photo: Xinhua

‘Major breakthroughs’: Chinese biotech firms plan global expansions after domestic success

Chinese biotech firms set to crack the global market within a decade, according to industry experts. Photo: Getty Images

China’s factory activity contracts in November for 8th month in a row

China’s purchasing managers’ index, based on surveys of supply chain managers, is a major monthly gauge of economic activity. Photo: Xinhua

China’s purchasing managers’ index, based on surveys of supply chain managers, is a major monthly gauge of economic activity. Photo: Future Publishing via Getty Images

Shanghai bets on manufacturing to buttress finance in two-pronged growth plan

The main hull assembly for China’s second domestically built large cruise ship was completed in Shanghai in January. Photo: Xinhua

Shanghai’s Lujiazui financial district, as seen from the Bund. Photo: EPA-EFE

Chinese vice-premier urges manufacturing upgrades, trade diversification in policy push

Vice-Premier He Lifeng inspects a hi-tech company in China’s Hubei province on Wednesday. Photo: Xinhua

Economy

China Economy

Economic Indicators

News

China

China’s manufacturing PMI rose to 50.1 in December, but analysts said it was too early to point to a sustained recovery


China’s manufacturing PMI rose to 50.1 in December, but analysts said it was too early to point to a sustained recovery.


China’s factory activity breaks 8-month contraction, but headwinds persist

.css-1c6uqr6{color:inherit;font-weight:inherit;font-size:inherit;font-family:inherit;line-height:inherit;overflow-wrap:break-word;}China’s manufacturing PMI rose to 50.1 in December, but analysts said it was too early to point to a sustained recovery

China’s manufacturing PMI rose to 50.1 in December, but analysts said it was too early to point to a sustained recovery