China’s Manufacturing PMI Rises to 50.5 in March 2025

China’s Manufacturing PMI Rises to 50.5 in March 2025

In March 2025, China’s manufacturing sector demonstrated notable resilience, with the Purchasing Managers’ Index (PMI) climbing to 50.5, up 0.3 percentage points from February. This marks the highest PMI reading in a year, indicating a modest expansion in manufacturing activities.​

The PMI is a critical economic indicator, with values above 50 suggesting expansion and those below 50 indicating contraction. The March uptick reflects a positive shift in the manufacturing landscape, driven by several key factors.​

Production and New Orders

The production index experienced a slight increase, reaching 52.6, a 0.1 percentage point rise from the previous month. More significantly, the new orders index advanced to 51.8, up 0.7 percentage points, signaling a strengthening in market demand. This growth suggests that both domestic and international orders have contributed to the sector’s expansion.​

Sectoral Performance

Various industries reported robust performance in March. The equipment manufacturing sector’s PMI rose to 52.0, reflecting a 1.2 percentage point increase from February. Notably, the new orders index within this sector surpassed 55, reaching its highest level since April 2023. Similarly, the high-tech manufacturing industry recorded a PMI of 52.3, up 1.4 percentage points month-on-month, indicating steady growth momentum.​

Enterprise Scale Analysis

Large enterprises maintained a PMI of 51.2, despite a slight decline of 1.3 points from February, remaining in expansion territory. Medium-sized and small enterprises showed significant improvements, with their PMIs rising to 49.9 and 49.6, respectively. Although these figures are just below the expansion threshold, they represent a positive trend toward stabilization.

Non-Manufacturing Sector

The non-manufacturing sector also exhibited growth, with its business activity index reaching 50.8, a 0.4 percentage point increase from the previous month. The construction industry’s activity index climbed to 53.4, the highest since June 2024, driven by favorable weather conditions and sustained investment demand. The service sector’s activity index rose to 50.3, indicating an overall increase in market vitality.

The March PMI data suggests that China’s manufacturing sector is demonstrating resilience amid global economic uncertainties. The expansion in production and new orders indicates a recovery in both domestic and international demand. However, challenges such as trade tensions and potential tariff implementations may pose risks to sustained growth. Policymakers are likely to continue focusing on boosting domestic demand and implementing fiscal support measures to navigate these challenges.