The National Bureau of Statistics reported that China's official Manufacturing Purchasing Managers' Index (PMI) reached 50.4% in March, an increase of 1.4 percentage points from the previous month. This places the index above the 50-point mark that separates expansion from contraction, indicating a recovery in manufacturing activity.

By enterprise size, the PMI for large enterprises stood at 51.6%, up 0.1 percentage points from February and remaining in expansionary territory. The PMI for medium and small enterprises was 49.0% and 49.3%, respectively, rising by 1.5 and 4.5 percentage points month-on-month but still below the 50-point threshold.

Among the five sub-indices that constitute the manufacturing PMI, the production index and new orders index were both above 50%, while the raw materials inventory index, employment index, and supplier delivery time index remained in contraction.

The production index came in at 51.4%, up 1.8 percentage points from the prior month, reflecting accelerated manufacturing output. The new orders index rose 3.0 percentage points to 51.6%, signaling a notable improvement in market demand. The raw materials inventory index edged up 0.2 percentage points to 47.7%, indicating a slower rate of decline in inventory levels. The employment index increased 0.6 percentage points to 48.6%, suggesting a modest recovery in hiring sentiment. The supplier delivery time index rose 0.4 percentage points to 49.5%, though it remained below 50%, indicating longer delivery times from suppliers compared to February.

The non-manufacturing Business Activity Index reached 50.1% in March, up 0.6 percentage points from the previous month and above the expansion-contraction threshold, pointing to improved conditions in the non-manufacturing sector.

By sector, the business activity index for construction was 49.3%, up 1.1 percentage points, while the index for services rose 0.5 percentage points to 50.2%. Within services, industries such as railway transport, telecommunications, monetary and financial services, and insurance recorded business activity indices above 55.0%, indicating strong performance. In contrast, retail, accommodation, catering, and real estate sectors remained in contraction.

The new orders index for non-manufacturing fell 0.2 percentage points to 45.0%, reflecting weaker market demand. The construction new orders index rose 1.3 percentage points to 43.5%, while the services new orders index dropped 0.4 percentage points to 45.3%.

The input price index for non-manufacturing increased 1.4 percentage points to 52.3%, suggesting continued rises in input costs. The construction input price index rose 3.6 percentage points to 52.7%, while the services input price index climbed 1.0 percentage point to 52.2%.

The selling price index rose 1.1 percentage points to 49.9%, still below 50%, indicating a slower decline in selling prices. The construction selling price index increased 1.7 percentage points to 49.3%, while the services selling price index reached 50.0%, up 1.0 percentage point.

The non-manufacturing employment index fell 0.8 percentage points to 45.2%, reflecting weaker hiring sentiment. The construction employment index dropped 3.4 percentage points to 39.1%, while the services employment index declined 0.4 percentage points to 46.2%.

The business expectations index for non-manufacturing declined 0.8 percentage points to 54.2%, though it remained in optimistic territory. The construction expectations index fell 0.4 percentage points to 50.5%, while the services expectations index dropped 1.0 percentage point to 54.8%.

The composite PMI output index, which covers both manufacturing and non-manufacturing sectors, rose 1.0 percentage point to 50.5% in March, staying above the critical 50-point level and indicating an overall improvement in Chinese corporate production and operating conditions.