China factory activity picks up as orders rebound

Chinese factory activity expanded for the first time in eight months in December as orders picked up before holidays and builders rushed to finish projects.

The official purchasing managers index for manufacturing, a monthly survey of companies, rose to 50.1 in December, the National Bureau of Statistics reported on Wednesday.

That was just above the 50 cut-off for expansion versus contraction on a scale up to 100.

Another, private sector, survey also was at 50.1 for December.

The better-than-expected readings partly reflect easing pressure due to an extended truce in trade tensions with the US.

They also suggest manufacturers ramped up production before New Year holidays, when many companies close for days.

China's Lunar New Year falls in mid-February this year.

In comments to a gathering carried on Wednesday by China's state media, President Xi Jinping, vowed to promote "high-quality development" and to carry out "more positive macroeconomic policies" while ensuring social harmony and stability.

The world's second largest economy is forecast to grow at a pace just below the official target of about five per cent in 2025, supported by strong activity in high-tech industries and exports.

The official PMI for high-tech manufacturing stood at 52.5 in December, up 2.4 percentage points from the previous month.

The report said the PMIs for both equipment manufacturing and the consumer goods industry reached 50.4.

The separate report by RatingDog, a Chinese credit research and analysis company based in the southern city of Shenzhen, said that despite an increase in overall orders, new export sales fell slightly and hiring weakened.

"Overall, the manufacturing sector regained growth at the end of 2025," RatingDog's founder Yao Yu said in a statement.

"However, the improvement was marginal, with the impact of promotions and new products appearing impulse-driven and their sustainability requiring observation."

The National Statistic Bureau said the PMI measures for food, textiles, clothing and electronics were above a relatively strong 53.

However, while large manufacturers increased their output, factory activity for the small and mid-sized enterprises that account for the lion's share of employment in China remained in contractionary territory.

As consumers cut back on spending, conditions for retailers and restaurants also deteriorated, the report said.

Some economists believe China's economy is growing more slowly than official figures suggest.

Its leaders are grappling with long-term challenges including a years-long slump in the country's property sector and excess capacity in many industries, including auto making, that has led to damaging price wars.