BEIJING — The China manufacturing PMI rose to 50.1 in December, ending a record eight-month run of contraction, while a separate gauge covering services and construction also moved back into expansion at 50.2. The rebound appears tied to pre-holiday stockpiling ahead of the Lunar New Year and firmer domestic orders, though economists cautioned the momentum could fade without a broader pickup in consumer demand, Dec. 31, 2025.
China’s official PMIs are watched for early clues on growth. The China manufacturing PMI is one of the first major monthly readings; numbers above 50 signal expansion and below 50 contraction.
China manufacturing PMI: what changed in December
According to a Reuters report, the official China manufacturing PMI beat market expectations and was lifted by stronger output and new business.
The production sub-index climbed to 51.7 from 50.0 in November and new orders rose to 50.8 from 49.2, their strongest showing since March, the report said. New export orders remained below the expansion line at 49.0, pointing to softer overseas demand.
Julian Evans-Pritchard, head of China economics at Capital Economics, said the improvement may be “a short-lived upturn” driven by month-to-month swings in fiscal spending rather than the start of a sustained recovery.
Services rebound to 50.2, but activity remains mixed
The non-manufacturing PMI rose to 50.2 in December, up 0.7 points from November, according to an update published on the Chinese government’s English-language site. Within that report, the sub-index tracking business activity in the service sector improved but stayed slightly below 50 at 49.7, while construction activity strengthened to 52.8.
A brief dispatch from Xinhua highlighted the same headline readings and noted that large manufacturers outperformed smaller firms, with the PMI for large enterprises at 50.8 and the index for small enterprises still below 50.
How this compares with earlier PMI signals
The latest turn follows a stretch of sub-50 readings through most of 2025. In April, the manufacturing PMI fell to 49.0, according to the National Bureau of Statistics’ April 2025 PMI release, as weaker demand pulled the gauge back into contraction territory.
More recently, the official PMI was 49.2 in November — the eighth straight month below 50 — according to a Nov. 30 Reuters report. December’s rise back above 50 breaks that streak, but the broader test will be whether the China manufacturing PMI can stay in expansion as the property downturn and weak household spending continue to weigh on sentiment.
Bloomberg reported the improved factory data came as President Xi Jinping said China is set to meet its 2025 growth target of “about 5%.”
For investors and policymakers, the next question is whether the China manufacturing PMI can hold above 50 into early 2026 and whether services can build a more durable expansion driven by stronger household demand.
