Manufacturing activity in mainland China grew at its fastest in three months in February, according to the country’s latest official purchasing managers’ index (PMI) – which came in at 50.2, up from 49.1 in January. A total of 50 or more means that manufacturing is expanding.
Sub-indices for production and new orders were at 52.5 and 51.1, respectively, for the month. Those for the equipment and high-tech sectors stood at 50.8 and 50.9, respectively.
Officials should find the readings a reassuring indication that stimulus measures introduced late last year are working, Reuters reported. The PMI was also good news for China’s economic recovery ahead of this week’s “two sessions” gathering of the nation’s political elites and lawmakers.
[See more: What to watch for at China’s ‘two sessions’]
The high-profile meetings of the Chinese People’s Political Consultative Conference and the National People’s Congress are expected to lead to announcements around Beijing’s 2025 economic targets, policy support for the mainland’s beleaguered property sector, and further measures to boost domestic consumption.
Zhang Zhiwei, chief economist at Pinpoint Asset Management, told Reuters that last month’s buoyant PMI “may be affected by seasonal factors related to the Spring Festival in January and February.” (Spring Festival is an alternative name for the Lunar New Year.)
The improved performance could also be overshadowed by additional tariffs US President Donald Trump has said he would slap on Chinese imports starting from today. The move, announced yesterday, would result in a cumulative 20 percent tariff rate. Senior officials from the central government reportedly met on Friday, and said they were prepared to prevent and resolve any external shocks to China’s economy.
