According to data released by the National Bureau of Statistics, in December, the Manufacturing Purchasing Managers' Index (PMI) was 50.1%, a decrease of 0.2 percentage points compared to the previous month, with the manufacturing sector continuing to expand.

From Statistics Micro News. I. Operations of China's Manufacturing Purchasing Managers' Index Looking at enterprise size, the PMI for large enterprises fell 0.6 percentage points to 50.1% this month compared to last month. The PMIs for medium and small-sized enterprises rose 0.4 and 0.7 percentage points to 49.8% and 47.4% respectively. Analyzing the classification index, amongst the five classification indexes that constitute the Manufacturing PMI, the production index is higher than the baseline while the indexes for new orders, raw material inventory, employment and supplier delivery time are all lower than that baseline. The production index is 50.6%, a decrease of 0.2 percentage points from last month but still higher than the baseline, indicating that manufacturing companies are still in expansion mode. The new order index is 49.5%. A marginal decrease of 0.1 percentage points from last month indicates a slight decline in manufacturing market demand. The raw material inventory index is 47.6%, a decrease of 0.2 percentage points from last month, indicating that stocks of raw materials in major manufacturing companies continue to decrease. The employment index remains steady at 48.1% from last month, indicating that the overall situation for employee hiring within manufacturing companies is stable. The supplier delivery time index is 49.5%, a decrease of 0.6 percentage points from last month, indicating that the delivery times for raw material suppliers have increased compared to last month. II. Operations of China's Non-Manufacturing Purchasing Managers' Index In June, the Business Activities Index for non-manufacturing was 50.5%, a decrease of 0.6 percentage points compared to last month, but still remains above the baseline, indicating that non-manufacturing is still expanding. Looking at it from the various industries, the business activity index for the construction industry decreased 2.1 percentage points to 52.3%, service industry decreased 0.3 percentage points to 50.2%. From the industry perspective, the business activity index for industries such as aviation transportation, postal services, telecommunications broadcasting and satellite transmission services, monetary and financial services, and insurance were all above 55.0%, indicating a higher prosperity range. However, the business activity index of industries such as capital market services and real estate was below the baseline. The new order index is 46.7%, a decrease of 0.2 percentage points from last month, indicating that the demand for non-manufacturing markets has slightly declined. From the perspective of different industries, the new order index of the construction industry was 44.1%, unchanged from last month; the new order index of the service industry was 47.1%, a decrease of 0.3 percentage points from last month. The input price index was 49.6%, a decrease of 0.1 percentage points from last month, indicating that the overall level of input prices for non-manufacturing enterprises has fallen slightly. From the perspective of different industries, the input price index of the construction industry was 51.7%, a decrease of 1.9 percentage points from last month; the input price index of the service industry was 49.3%, an increase of 0.3 percentage points from last month. The sales price index was 47.6%, a decrease of 0.2 percentage points from last month, indicating that the overall level of sales prices for non-manufacturing has continued to fall. From the perspective of different industries, the sales price index of the construction industry was 49%, a decrease of 0.7 percentage points from last month; the sales price index of the service industry was 47.4%, a decrease of 0.1 percentage points from last month. The employment index is 45.8%, a decrease of 0.4 percentage points from last month, indicating a slight decrease in the employment level of non-manufacturing enterprises. From the perspective of different industries, the employment index of the construction industry was 42.9%, a decrease of 0.4 percentage points from last month; the employment index of the service industry was 46.3%, a decrease of 0.4 percentage points from last month. The business activity expectation index is 57.2%, an increase of 0.3 percentage points from last month, and continues to remain in the higher prosperity range, indicating that non-manufacturing enterprises remain optimistic about the market development prospects. From the perspective of different industries, the business activity expectation index of the construction industry was 54.7%, a decrease of 1.6 percentage points from last month; the business activity expectation index of the service industry was 57.6%, an increase of 0.6 percentage points from last month. III. Operations of China's Comprehensive PMI Output Index In June, the Comprehensive PMI output index decreased by 0.5 percentage points to 50.5% compared to last month, but remains higher than the baseline, indicating that overall production and operation activities in China's businesses continue to expand.

In December, the Manufacturing Purchasing Managers' Index (PMI) was 50.1%, a decrease of 0.2 percentage points compared to the previous month, with the manufacturing sector continuing to expand.

From the perspective of enterprise size, the PMI for large enterprises was 50.5%, a decrease of 0.4 percentage points from the previous month, remaining above the critical point; the PMI for medium-sized enterprises was 50.7%, an increase of 0.7 percentage points from the previous month, remaining above the critical point; the PMI for small enterprises was 48.5%, a decrease of 0.6 percentage points from the previous month, falling below the critical point.

Looking at the classification indices, among the 5 classification indices that make up the manufacturing PMI, the production index, new order index, and supplier delivery time index were above the critical point, while the raw material inventory index and employment index were below the critical point.

The production index was 52.1%, a decrease of 0.3 percentage points from the previous month, still above the critical point, indicating that production activities in manufacturing enterprises are maintaining rapid expansion.

The new orders index was 51.0%, an increase of 0.2 percentage points from the previous month, indicating that market demand in the manufacturing sector continues to improve.

The raw material inventory index is 48.3%, an increase of 0.1 percentage points over the previous month, still below the critical point, indicating that the decline in inventory levels of major raw materials in the manufacturing industry has narrowed.

The employment index is 48.1%, a decrease of 0.1 percentage points from the previous month, indicating a slight decline in the employment boom among manufacturing enterprises.

The supplier delivery time index is 50.9%, an increase of 0.7 percentage points over the previous month, indicating that the delivery times of raw material suppliers in the manufacturing industry continue to accelerate.

II. Operations of China's Non-Manufacturing Purchasing Managers' Index In June, the Business Activities Index for non-manufacturing was 50.5%, a decrease of 0.6 percentage points compared to last month, but still remains above the baseline, indicating that non-manufacturing is still expanding.

In December, the non-manufacturing business activity index is 52.2%, an increase of 2.2 percentage points from the previous month, showing a significant recovery in non-manufacturing activity levels.

By industry, the construction business activity index is 53.2%, an increase of 3.5 percentage points from the previous month; the services business activity index is 52.0%, an increase of 1.9 percentage points from the previous month. In terms of industry, the business activity indices in railroads, water transportation, aviation transportation, postal services, telecommunications Broadcasting - TV and Satellite transmission services, MMF services, Insurance, and other sectors are all above the relatively high boom range of 55.0%; the business activity indices in lodging, dining, and residential services are below the critical point.

The new order index is 48.7%, an increase of 2.8 percentage points from the previous month, indicating a low recovery in market demand in the non-manufacturing sector. By industry, the new order index in construction is 51.4%, an increase of 7.9 percentage points from the previous month; the new order index in services is 48.2%, an increase of 1.8 percentage points over the previous month.

The input price index is 50.5%, an increase of 1.4 percentage points from the previous month, indicating that the overall level of input prices for operational activities in non-manufacturing enterprises has risen. By industry, the input price index in construction is 49.4%, an increase of 1.4 percentage points from the previous month; the input price index in services is 50.7%, an increase of 1.4 percentage points from the previous month.

The sales price index is 48.8%, unchanged from last month, still below the critical point, indicating that the overall level of sales prices in the non-manufacturing industry continues to decline. By industry, the sales price index for the construction industry is 47.5%, a decrease of 1.1 percentage points from last month; the sales price index for the service industry is 49.1%, an increase of 0.3 percentage points from last month.

The employment index is 45.8%, an increase of 0.4 percentage points from last month, indicating an improvement in labor market conditions for non-manufacturing enterprises. By industry, the employment index for the construction industry is 42.7%, an increase of 2.0 percentage points from last month; the employment index for the service industry is 46.3%, an increase of 0.1 percentage points from last month.

The business activity expectation index is 57.5%, an increase of 0.5 percentage points from last month, indicating that non-manufacturing enterprises have gained more confidence in recent market developments. By industry, the business activity expectation index for the construction industry is 57.1%, an increase of 1.5 percentage points from last month; the business activity expectation index for the service industry is 57.6%, an increase of 0.3 percentage points from last month.

III. Operations of China's Comprehensive PMI Output Index In June, the Comprehensive PMI output index decreased by 0.5 percentage points to 50.5% compared to last month, but remains higher than the baseline, indicating that overall production and operation activities in China's businesses continue to expand.

In December, the comprehensive PMI output index is 52.2%, an increase of 1.4 percentage points from last month, indicating an acceleration in the overall expansion of production and operation activities of enterprises in China.

In December, the manufacturing purchasing manager index has remained in the expansion range for three consecutive months.

The non-manufacturing business activity index has significantly rebounded.

—— Zhao Qinghe, senior statistician at the National Bureau of Statistics Service Industry Survey Center, interprets the Purchasing Manager Index for China in December 2024.

On December 31, 2024, the National Bureau of Statistics Service Industry Survey Center and the China Federation of Logistics and Purchasing released the China Purchasing Managers Index. In this regard, Senior Statistician Zhao Qinghe from the National Bureau of Statistics Service Industry Survey Center provided an interpretation.

In December, the manufacturing Purchasing Managers Index was 50.1%, down 0.2 percentage points from the previous month; the Non-Manufacturing Business Activity Index and the Composite PMI Output Index both stood at 52.2%, increasing by 2.2 and 1.4 percentage points respectively from last month. All three indices are in the expansion range, corporate production and operation activities have accelerated, and the economic prosperity level in China continues to recover and improve.

1. The manufacturing Purchasing Managers Index remains in expansion.

In December, the macro policy combination effect continued to show, with the manufacturing PMI at 50.1%, staying above the critical point for three consecutive months.

(1) Both supply and demand continue to expand. The production index is 52.1%, down 0.3 percentage points from last month, while the new orders index is 51.0%, up 0.2 percentage points from the previous month, with both indices remaining above the critical point, indicating that production and market demand in manufacturing enterprises continue to expand. From the perspective of industries, the production indices and new orders indices for industries such as processed agricultural products, food and beverage refined tea, General Equipment, and electrical machinery all exceed 54.0%, showing rapid growth in related industries; however, the indices for industries such as black metal smelting and rolling processing and Metal Products are both below the critical point, indicating relatively insufficient release of production and demand. To meet production needs, enterprises have increased their procurement efforts, with the procurement volume index standing at 51.5%, up 0.5 percentage points from last month, continuing to expand for two consecutive months.

(2) The PMI of large and medium-sized enterprises is above the critical point. The PMI for large enterprises is 50.5%, down 0.4 percentage points from last month, and has remained above the critical point this year, showing significant support to manufacturing; the PMI for medium-sized enterprises is 50.7%, up 0.7 percentage points from last month, marking the first return to the expansion range in eight months; the PMI for small enterprises is 48.5%, down 0.6 percentage points from last month, indicating a slight decline in prosperity.

(3) Some key industries maintain expansion. In key industries, driven by the old-for-new policy in consumer products and the approach of traditional festivals, the pace of expansion in related industries has accelerated, with the consumer goods industry PMI at 51.4%, up 0.6 percentage points from last month; the equipment manufacturing PMI at 50.6%, remaining in the expansion range for five consecutive months and continuing to develop rapidly; the high energy-consuming industry PMI at 48.8%, down 0.4 percentage points from last month, indicating a downturn in prosperity levels.

(4) Overall price levels have slightly declined. The main raw material purchase price index and the factory price index are 48.2% and 46.7% respectively, down 1.6 and 1.0 percentage points from last month, indicating a general decrease in manufacturing market price levels.

II. The Index of Business Activity in the Non-Manufacturing Sector has significantly rebounded.

In December, the Index of Business Activity in the Non-Manufacturing Sector was 52.2%, an increase of 2.2 percentage points from the previous month, indicating a significant improvement in the non-manufacturing sentiment.

1. The service industry shows positive recovery. The Index of Business Activity in the service industry was 52.0%, up 1.9 percentage points from the previous month, reaching its highest point since April, with an accelerated pace of expansion. Among the 21 industries surveyed, 17 had a Business Activity Index higher than last month, with sentiment across industries generally rebounding. Notably, the Business Activity Index for Aviation Transportation, Telecommunications Broadcasting - TV and Satellite Transmission Services, MMF Services, Insurance, and other industries rose above 60.0%, indicating a high level of activity and rapid growth in overall business volume; however, the Business Activity Index in resident services declined compared to last month. Market expectations show that the Business Activity Expectation Index stands at 57.6%, an increase of 0.3 percentage points from last month, with service companies becoming increasingly stable in their expectations for market recovery and development.

2. The construction industry returns to expansion. Due to factors such as the upcoming Spring Festival holiday, some enterprises are racing against time to catch up on construction progress; the Index of Business Activity in the construction industry is 53.2%, up 3.5 percentage points from last month. In terms of market demand, the New Order Index stands at 51.4%, marking its first rise into the expansion range this year, with an increase in the volume of newly signed contracts among construction enterprises. The Business Activity Expectation Index is at 57.1%, increasing by 1.5 percentage points from last month, marking three consecutive months of recovery, indicating a strengthened confidence among construction enterprises regarding recent industry developments.

III. Comprehensive PMI Output Index accelerates expansion.

In December, the Comprehensive PMI Output Index was 52.2%, an increase of 1.4 percentage points from last month, indicating an overall acceleration in the production and operational activities of enterprises in China. The manufacturing production index and non-manufacturing business activity index that compose the Comprehensive PMI Output Index were 52.1% and 52.2% respectively.

Editor/Rocky