Group 1: Manufacturing Sector Insights - The manufacturing PMI for March 2026 is 50.4%, an increase of 1.4 percentage points from the previous month, marking a return to the expansion zone after two months[7] - The new orders index and production index are at 51.6% and 51.4%, respectively, both above the critical point, indicating strong demand recovery[13] - Small and medium-sized enterprises' PMIs have significantly improved, with small enterprises at 49.0% (up 1.5 percentage points) and medium enterprises at 49.3% (up 4.5 percentage points) from the previous month[10] Group 2: Price and Cost Pressures - The main raw material purchase price index is at 63.9%, up 9.1 percentage points, while the factory price index is at 55.4%, up 4.8 percentage points, indicating rising input costs due to geopolitical tensions[16] - The procurement volume index has risen to 50.9%, reflecting increased purchasing activity driven by demand recovery[18] - The inventory indices for raw materials and finished products are at 47.7% and 46.7%, respectively, indicating a slowdown in inventory depletion[18] Group 3: Non-Manufacturing Sector Performance - The non-manufacturing business activity index is at 50.2%, up 0.5 percentage points, with significant internal differentiation in the service sector[20] - The construction business activity index is at 49.3%, up 1.1 percentage points, but still indicates a low level of activity, with new orders at 43.5%[23] - Consumer services sectors such as retail and hospitality are below the critical point, suggesting a need for policy support to boost consumer confidence[20] Group 4: Risks and Future Outlook - Rising raw material prices may squeeze profit margins for downstream enterprises, potentially suppressing future investment and production willingness[26] - The ongoing geopolitical tensions in the Middle East remain a critical variable, with sustained high oil prices likely to exacerbate cost pressures in downstream industries[26] - Real estate demand needs to be stimulated, and geopolitical risks could disrupt market stability[27]

Manufacturing Sector - March manufacturing PMI improved to 50.4%, up 1.4 percentage points month-on-month, indicating a return to expansion[3] - The production index rose by 1.8 percentage points to 51.4%, while new orders increased by 3.0 percentage points to 51.6%[14] - Industrial raw material prices have rebounded significantly, with March PPI expected to rise by approximately 0.3% year-on-year[20] Non-Manufacturing Sector - Construction PMI increased by 1.1 percentage points to 49.3%, benefiting from the gradual resumption of projects post-holiday[22] - Service sector PMI rose to 50.2%, a 0.5 percentage point improvement, although new orders remain weak[30] Economic Outlook - Q1 GDP is projected to grow by approximately 5.0% year-on-year, supported by AI demand and fiscal spending[6] - The growth forecast includes primary, secondary, and tertiary industries at approximately 3.5%, 5.2%, and 5.0% respectively[34] - Input inflation may pressure profits in downstream enterprises, necessitating timely policy responses to support economic recovery[33] Risks - Potential risks include unexpected policy changes and a possible recession in the U.S. economy impacting domestic exports[35]

Core Viewpoint - In March 2026, China's Purchasing Managers' Index (PMI) returned to the expansion zone, indicating a recovery in economic sentiment with manufacturing PMI at 50.4%, non-manufacturing business activity index at 50.1%, and composite PMI output index at 50.5% [1]. Group 1: Manufacturing PMI - The manufacturing PMI rose to 50.4% in March, reflecting increased market activity as companies resumed operations post-Spring Festival [2]. - Both production index and new orders index improved, reaching 51.4% and 51.6% respectively, indicating accelerated production activities and improved market demand [2]. - Large, medium, and small enterprises all saw a rise in PMI, with large enterprises at 51.6%, medium at 49.0%, and small at 49.3%, showing significant improvement in sentiment for smaller firms [2]. Group 2: Key Industries - High-tech manufacturing PMI stood at 52.1%, marking 14 consecutive months above the critical point, indicating a positive development trend [3]. - Equipment manufacturing and consumer goods industries also showed expansion with PMIs of 51.5% and 50.8% respectively [3]. - The price index for major raw materials surged, with purchasing price index at 63.9% and factory price index at 55.4%, reflecting a significant increase in market prices [3]. Group 3: Non-Manufacturing PMI - The non-manufacturing business activity index rose to 50.1%, indicating an improvement in the non-manufacturing sector [5]. - The service sector's business activity index reached 50.2%, with certain industries like telecommunications and financial services showing strong growth [5]. - The construction industry also saw an improvement, with a business activity index of 49.3%, reflecting a recovery in construction projects post-holiday [5]. Group 4: Composite PMI - The composite PMI output index increased to 50.5%, indicating an overall positive trend in production and business activities across sectors [6]. - The manufacturing production index and non-manufacturing business activity index contributed to this increase, standing at 51.4% and 50.1% respectively [6].

Group 1: Manufacturing PMI Insights - In March, the Manufacturing Purchasing Managers' Index (PMI) rose to 50.4%, indicating a return to the expansion zone, driven by increased market activity post-Spring Festival [4] - Both production index and new orders index improved, reaching 51.4% and 51.6% respectively, reflecting accelerated production activities and improved market demand [4] - Large, medium, and small enterprises all showed PMI increases, with large enterprises at 51.6%, medium at 49.0%, and small at 49.3%, indicating a general improvement in economic conditions [4][5] Group 2: Sector-Specific Performance - High-tech manufacturing PMI reached 52.1%, marking 14 consecutive months above the critical point, indicating a positive development trend [5] - The equipment manufacturing and consumer goods sectors also saw PMIs of 51.5% and 50.8%, respectively, both entering the expansion zone [5] - The price indices for major raw materials and factory prices significantly increased to 63.9% and 55.4%, respectively, due to rising commodity prices and increased procurement activities [5] Group 3: Non-Manufacturing PMI Insights - The Non-Manufacturing Business Activity Index rose to 50.1%, showing an improvement in the non-manufacturing sector's economic conditions [7] - The service sector's business activity index reached 50.2%, with significant growth in sectors like rail transport and financial services, while retail and hospitality lagged behind [7] - The construction sector's business activity index improved to 49.3%, with a positive outlook for future activities as indicated by a business activity expectation index of 50.5% [7] Group 4: Comprehensive PMI Overview - The Comprehensive PMI Output Index increased to 50.5%, indicating an overall improvement in production and business activities across sectors [8] - The manufacturing production index and non-manufacturing business activity index contributed to this increase, standing at 51.4% and 50.1% respectively [8]

Core Viewpoint - The manufacturing PMI has marginally declined due to seasonal disruptions from the longest Spring Festival holiday in history, with input inflation being a key concern moving forward [1][2]. Manufacturing Sector - In February 2026, the manufacturing PMI stood at 49.0%, down 0.3 percentage points from the previous month, indicating a lower-than-average performance for this time of year due to the holiday disruption [2]. - The production index was notably affected, particularly impacting small and medium-sized enterprises, while high-tech manufacturing remains in the expansion zone [2]. - The consumer goods sector's PMI increased to 48.8%, up 0.5 percentage points from last month, driven by consumption policies [2]. Supply and Demand Index - The supply and demand index experienced a seasonal decline, with new export orders showing a significant drop, although domestic demand remains relatively stable when seasonal factors are excluded [3]. - Industries such as agricultural processing and computer communication equipment are expanding, while textiles and automotive sectors remain below the critical point [3]. - The purchasing price index for raw materials has slightly decreased, while factory prices remain stable, potentially improving revenue expectations for businesses [3]. Non-Manufacturing Sector - The service sector showed stable performance with a slight increase in the business activity index, although there is significant structural differentiation [3]. - Industries related to consumer travel, such as accommodation and dining, are experiencing rapid growth, while capital market services and real estate are operating at low levels [3]. - The construction sector's business activity index has marginally declined due to the holiday, with some projects temporarily halted [3]. Future Outlook - The macroeconomic policy is expected to be more proactive, with a focus on supporting overall demand [4]. - The Central Political Bureau has indicated a commitment to more active fiscal policies and moderately loose monetary policies, with potential for further interest rate cuts [4]. - There will be an emphasis on boosting consumption and expanding investment, including infrastructure projects like parking lots and charging stations [4].

Economic Overview - The manufacturing PMI for February 2026 decreased by 0.3 percentage points to 49%, indicating a contraction in the manufacturing sector[7] - Despite the decline, the actual performance is considered better than seasonal expectations due to the impact of the Spring Festival[7] - The construction sector's business activity index fell to 48.2%, down 0.6 percentage points, reflecting reduced activity during the holiday period[7] Supply and Demand Dynamics - The overall supply exceeds demand, with production and new orders PMI at 49.6% and 48.6% respectively, indicating no significant improvement in the supply-demand balance[7] - The gap between raw material purchase prices PMI and factory prices PMI is narrowing, but it remains uncertain if this indicates improved bargaining power for downstream enterprises[7] Sector Performance - High-tech manufacturing PMI recorded at 51.5%, remaining a key driver of economic growth, while consumer goods PMI rose to 48.8% but still below the expansion threshold[7] - Service sector activity index increased to 49.7%, with growth driven by hospitality and entertainment sectors during the Spring Festival[7] External Factors and Risks - Risks include slower-than-expected transmission of counter-cyclical policies, uncertainties in trade policies from other countries, and potential impacts of geopolitical conflicts on commodity prices[4]

Group 1: Manufacturing Sector - The manufacturing PMI for February is 49.0%, down 0.3 percentage points month-on-month, indicating continued weakness influenced by the Spring Festival effect[1] - The production PMI decreased by 1.0 percentage points to 49.6%, while new orders, new export orders, and import PMIs fell by 0.6, 2.8, and 1.7 percentage points to 48.6%, 45.0%, and 45.6% respectively[12] - Large enterprises showed improvement with a PMI increase of 1.2 percentage points, while medium and small enterprises saw declines of 1.2 and 2.6 percentage points respectively[20] Group 2: Non-Manufacturing Sector - The construction PMI fell by 0.6 percentage points to 48.2%, with new orders index slightly improving by 2.1 percentage points to 42.2%[25] - The service sector PMI increased to 49.7%, up 0.2 percentage points, but new orders remain weak[32] - The issuance progress of special bonds reached approximately 18.7%, better than 13.0% in the same period of 2025[25] Group 3: Economic Outlook - The resumption of work is slightly faster than in previous years, with a construction resumption rate of 8.9% as of February 25, 2026, an increase of 1.5 percentage points year-on-year[37] - Economic fundamentals in Q1 are expected to remain under pressure, necessitating stronger growth stabilization policies, including additional policy financial tools and accelerated fiscal spending[37] - Risks include unexpected policy changes and potential downturns in the U.S. economy affecting domestic exports[42]

Group 1: Manufacturing Purchasing Managers Index (PMI) - In February, the manufacturing PMI decreased to 49.0%, down by 0.3 percentage points from the previous month, indicating a decline in economic activity [2][3] - Both production index and new orders index fell to 49.6% and 48.6% respectively, showing a slowdown in production and market demand [3] - Large enterprises maintained expansion with a PMI of 51.5%, while small and medium-sized enterprises faced significant impacts from the Spring Festival, with PMIs of 47.5% and 44.8% respectively [3] Group 2: Non-Manufacturing Business Activity Index - The non-manufacturing business activity index rose slightly to 49.5%, an increase of 0.1 percentage points from the previous month, indicating an overall improvement in the non-manufacturing sector [6] - The service sector's business activity index increased to 49.7%, driven by growth in travel-related industries, with hospitality and entertainment sectors showing indices above 60.0% [6] - The construction sector's business activity index fell to 48.2%, reflecting a decline due to the Spring Festival, although the market expectation index for construction improved to 50.9% [6] Group 3: Comprehensive PMI Output Index - The comprehensive PMI output index decreased to 49.5%, down by 0.3 percentage points from the previous month, indicating a general slowdown in production and business activities [7] - The manufacturing production index and non-manufacturing business activity index were recorded at 49.6% and 49.5% respectively, contributing to the overall decline in the comprehensive PMI [7]

Group 1: PMI Overview - In February 2026, the Manufacturing Purchasing Managers' Index (PMI) was 49.0%, a decrease of 0.3 percentage points from the previous month[1] - The Construction Business Activity Index was 48.2%, down from 48.8%[1] - The Services Business Activity Index was 49.7%, slightly up from 49.5%[1] Group 2: Seasonal Factors and Trends - The decline in PMI is attributed to seasonal factors such as the Spring Festival, with both supply and demand showing temporary slowdowns[2] - The production index fell to 49.6% from 50.6%, and the new orders index dropped to 48.6% from 49.2%[3] - The operating rate decreased by 3.49 percentage points to 39.51%, while the electric furnace capacity utilization rate fell by 17.41 percentage points to 36.34%[3] Group 3: Price and Inventory Dynamics - The factory price index remained stable at 50.6%, while the purchasing price index decreased by 1.3 percentage points to 54.8%[4] - The gap between purchasing prices and factory prices narrowed to 4.2 percentage points, indicating some relief in cost pressures for enterprises[4] - Finished goods inventory index decreased by 2.8 percentage points to 45.8%, while raw materials inventory increased slightly by 0.1 percentage points to 47.5%[4] Group 4: Future Outlook - Manufacturing production activity is expected to recover in March as the effects of the Spring Festival dissipate, with production and new orders indices anticipated to rise[2] - External demand remains resilient, supported by OECD leading indicators pointing to a mild upward trend in exports through June[2] - Domestic demand relies on further policy support and improvements in terminal consumption and investment needs[2]

Group 1: PMI and Economic Indicators - February manufacturing PMI was 49.0, down from 49.3, indicating a seasonal decline consistent with historical trends[3] - The BCI index for February recorded 52.4, down from 53.7 in January, but still above the 49.8 level from December last year[3] - The estimated actual GDP growth for February is 4.81%, with nominal GDP at 4.70%[4] Group 2: Manufacturing and Business Conditions - The production index in February was 49.6, down 1.0 points, while the new orders index was 48.6, down 0.6 points[5] - Large enterprises showed a PMI of 51.5, up 1.2 points, while small enterprises had a PMI of 44.8, down 2.6 points[5] - The production expectation index rose to 53.2, indicating positive future production plans despite current slowdowns[6] Group 3: Price Indices and Industry Performance - The raw material purchase price index decreased to 54.8, while the factory price index remained stable at 50.6[8] - High-tech manufacturing PMI was 51.5, while consumer goods industry PMI improved to 48.8, indicating sector-specific growth[7] - The construction business activity index fell to 48.2, but the expectation index rose to 50.9, suggesting optimism for future activity[8] Group 4: Consumer and Service Sector Insights - The service sector PMI increased slightly to 49.7, with hospitality and entertainment sectors showing strong performance, indices above 60[9] - The long holiday effect positively influenced consumer spending, particularly in retail and services, indicating potential for future policy impacts[11]