China’s factory activity growth accelerated to a one-year high in March, according to official data, as stimulus measures kicked in. The purchasing managers’ index (PMI) rose to 50.5, surpassing the threshold for expansion from contraction, and indicating an improvement in manufacturing supply and demand.
The non-manufacturing PMI also rose to 50.8, covering services and construction sectors, suggesting that infrastructure spending is ramping up again and exports remain resilient despite US tariffs. However, the economy is expected to experience slower growth in the first quarter compared to the previous period, citing weakness in the services sector and unfavorable base effects.
Chinese policymakers have pledged to step up monetary and fiscal stimulus to achieve a growth target of around 5% this year, countering the impact of an escalating trade war with the US. The government has already introduced several measures, including expanded consumer goods trade-in schemes and accelerated issuance of government debt, to boost domestic consumption and ease deflationary pressures.
Despite these efforts, the latest data suggests that exports are losing momentum, growing at their slowest rate since April last year. The US president is set to unveil new tariffs designed to address trade imbalances on April 2, potentially hitting Chinese goods with additional duties.
Source: https://www.cnbc.com/2025/03/31/china-official-pmi-in-march.html