China's Purchasing Managers' Index (PMI) for March showed a return to expansion territory, according to data released on March 31, 2026. The manufacturing PMI, non-manufacturing Business Activity Index, and composite PMI output index all climbed above the 50-point mark that separates expansion from contraction, registering 50.4%, 50.1%, and 50.5% respectively. These figures represent increases of 1.4, 0.6, and 1.0 percentage points from the previous month, indicating a recovery in the country's economic activity.
Manufacturing PMI Rises into Expansion Zone The manufacturing PMI reached 50.4% in March, moving back into expansion territory as companies accelerated work resumption following the Spring Festival holiday, boosting market activity.
Both production and demand expanded simultaneously. The production index and new orders index stood at 51.4% and 51.6%, up 1.8 and 3.0 percentage points from February, respectively, both entering expansion territory. This reflects accelerated production activities among manufacturing firms and a notable improvement in market demand. Industries such as agricultural and food processing, and non-ferrous metal smelting and pressing saw both indices exceed 55.0%, indicating rapid release of production and demand. However, sectors including textiles, apparel, chemical fibers, and rubber and plastic products continued to register indices below the 50-point threshold, reflecting weaker market activity. Driven by recovering production and demand, corporate purchasing willingness strengthened, with the purchasing quantity index rising to 50.9%, up 2.7 percentage points from the previous month.
PMI readings for large, medium, and small enterprises all improved. The PMI for large enterprises was 51.6%, up 0.1 percentage point, showing steady growth in activity levels. Medium and small enterprises recorded PMIs of 49.0% and 49.3%, rising by 1.5 and 4.5 percentage points respectively, indicating significant improvement in their operating conditions.
Three key sectors expanded at a faster pace. The PMI for high-tech manufacturing reached 52.1%, up 0.6 percentage point, remaining above the 50-point mark for the 14th consecutive month, signaling sustained positive development. The equipment manufacturing and consumer goods sectors posted PMIs of 51.5% and 50.8%, rising 1.7 and 2.0 percentage points respectively, both returning to expansion. The PMI for high-energy-consumption industries was 48.9%, up 1.1 percentage points, reflecting a recovery in activity levels.
Price indices rose significantly. Influenced by recent increases in prices of some bulk commodities and accelerated corporate purchasing activities, the raw material purchase price index and ex-factory price index stood at 63.9% and 55.4%, up 9.1 and 4.8 percentage points respectively, indicating a marked rebound in overall price levels in the manufacturing sector. Industries such as petroleum, coal and other fuel processing, and chemical raw materials saw both price indices exceed 70.0%, pointing to substantial price increases in purchasing and sales.
Market expectations improved steadily. The production and operation expectation index was 53.4%, up 0.2 percentage point, showing enhanced confidence among manufacturers regarding near-term market development. Sectors including specialized equipment, automobiles, and railway, ship, aerospace equipment reported expectation indices above 56.0%, indicating high optimism among related firms about future industry prospects.
The survey also highlighted that due to geopolitical conflicts in the Middle East and other factors, prices for petroleum, chemical products, and related raw materials increased significantly, coupled with rising logistics costs. The proportion of companies reporting high raw material costs and high logistics costs rose compared to the previous month.
Non-Manufacturing Business Activity Index Recovers The non-manufacturing Business Activity Index reached 50.1% in March, up 0.6 percentage point, indicating improved activity levels in the sector.
The services Business Activity Index rose above the 50-point threshold to 50.2%, up 0.5 percentage point. Industries such as railway transport, telecommunication, broadcasting, satellite transmission services, monetary and financial services, and insurance recorded activity indices above 55.0%, reflecting rapid growth in business volume. Sectors related to post-holiday travel and consumption, including retail, accommodation, and catering, saw activity indices below 50.0%, indicating reduced market activity. The services business expectation index was 54.8%, remaining at a relatively high level, showing sustained optimism among services firms about market development.
The construction Business Activity Index improved. As construction projects resumed work after the holiday, the index reached 49.3%, up 1.1 percentage point. The construction business expectation index stood at 50.5%, above the 50-point mark, indicating confidence among construction firms in future industry development.
Composite PMI Output Index Rises Above Threshold The composite PMI output index was 50.5% in March, up 1.0 percentage point, indicating an overall improvement in corporate production and operation activity levels across China. The index is composed of the manufacturing production index (51.4%) and the non-manufacturing Business Activity Index (50.1%).