January 5, 2026 01:28 AM GMT Investor Presentation | Asia Pacific M Foundation China Economics: Beijing's New Year Resolution Beijing's New Year Resolution vs. The Market's: Closing the Policy Gap (18 December 2025) Morgan Stanley Asia Limited Robin Xing Chief China Economist Robin.Xing@morganstanley.com +852 2848-6511 Zhipeng Cai Economist Zhipeng.Cai@morganstanley.com +852 2239-7820 For important disclosures, refer to the Disclosure Section, located at the end of this report. Downloaded by Neil.Wang@trowe ...

PMI Details Look Better than Headlines CITI'S TAKE Vi e w p o i n t | 30 Nov 2025 18:43:43 ET │ 10 pages China Economics While headline PMI prints were soft in November, the underlying growth momentum could remain stable with recovering new orders and price indictors as well as finished goods destocking. The efforts deployed earlier like the RMB500bn policy-finance could be coming through. We keep our full-year GDP forecast unchanged at 5.0%. We believe the next policy window will be after the Central Econo ...

Summary of Key Points from the Conference Call Industry Overview - The report focuses on the **Chinese manufacturing sector**, highlighting the Manufacturing Purchasing Managers' Index (PMI) and its implications for the economy. Core Insights and Arguments 1. **Manufacturing PMI Decline**: - China's Manufacturing PMI fell to **49.0** in October, a decrease of **0.8 percentage points (pp)** from September, marking the seventh consecutive month in contraction territory [4][6][14] - The decline is attributed to seasonal effects, including **five fewer working days** in October compared to September, and a challenging trade environment [4][6] 2. **Policy Response**: - The Ministry of Finance (MoF) has allocated an unused local government bond quota of **RMB500 billion** for Q4 2025, with **RMB200 billion** earmarked for investment [6] - A new policy-finance instrument of **RMB500 billion** has been fully implemented, expected to drive total project investment exceeding **RMB7 trillion** [6] 3. **Investment Growth Recovery**: - A recovery in investment growth is anticipated towards the end of the year as policy measures take effect [6] - The full-year GDP forecast is maintained at **5%** for 2025, with expectations for the government to keep the GDP target at "around 5%" for 2026 [6] 4. **Production and Demand Weakness**: - The production index fell to **49.7**, the first reading below 50 in six months, indicating a slowdown in production [7] - New orders dropped to **48.8**, the lowest since January 2024, with new export orders particularly weak at **45.9** [7] 5. **Price and Employment Trends**: - Producer prices decreased to **47.5**, indicating easing price momentum [7] - The employment index edged down to **48.3**, reflecting weakened employment conditions despite some improvement in job sentiment [7] 6. **Non-Manufacturing PMI**: - The Non-Manufacturing PMI showed resilience, improving by **0.1 pp** to **50.1**, aligning with market consensus [5] 7. **Sector-Specific Insights**: - The services sector benefited from holiday travel, while the construction sector saw deterioration, with the Construction PMI easing to **49.1** [7][10] Additional Important Information - The report indicates that while major policy stimulus is not expected in 2025, incremental support measures are being deployed to cushion economic pressures [6] - The People's Bank of China (PBoC) is expected to resume government bond purchases and maintain ample liquidity amid growth pressures [6] This summary encapsulates the critical insights from the conference call regarding the current state of the Chinese manufacturing sector, policy responses, and economic forecasts.