PMI Photo:VCG

China's official manufacturing Purchasing Managers' Index (PMI) reached 50.1 in December, indicating continued expansion in the manufacturing sector, according to data released by the National Bureau of Statistics on Tuesday. The reading has remained in expansionary territory for three consecutive months, underscoring a positive economic recovery momentum as more pro-growth policies fuel demand on the consumption side and bolster market confidence, analysts said. 

The December reading marks a 0.2 percentage point drop from November, NBS data showed. Breaking down the manufacturing PMI, the index for new orders was 51 in December, up 0.2 percentage point from November, marking a rise for four consecutive months. Exports also showed signs of continued stabilization, with the new export orders index in December rising for two months in a row, according to the data.

Key sectors such as consumer goods and equipment manufacturing have registered accelerated growth in December, driven by the consumer goods trade-in policy and the approach of traditional festivals, according to a statement on the NBS website. 

The PMI for the consumer goods sector came in 51.4 in December, an increase of 0.6 percentage points from the previous month, while the PMI for the equipment manufacturing sector was 50.6 in December, remaining in the expansionary territory for five consecutive months, the statement noted. 

China's manufacturing sector returned to expansion in October after five consecutive months of contraction. Overall, China's manufacturing PMI for the fourth quarter was 50.2 on average, which is significantly higher than the 49.4 in the third quarter, according to a report by the China Central Television on Tuesday. 

In terms of China's non-manufacturing PMI which tracks activity in the service and construction sectors, the index jumped to 52.2 in December, up 2.2 percentage points month-on-month, the NBS data showed, indicating that the endogenous momentum for stable and progressive economic operation is further strengthening.

"Entering the fourth quarter, the supply and demand relationship in China's social production and business activities has showed further signs of balancing as a series of incremental policies gradually have taken effect," Yang Delong, chief economist at Shenzhen-based First Seafront Fund, told the Global Times on Tuesday. Yang added that the vibrant consumer activities at the year-end also give a boost to the positive trend in the manufacturing industry. 

Yang said that the manufacturing data also mirrors improved business expectations and a strengthened economic foundation. 

"The Central Economic Work Conference in December has further injected stronger confidence into the market. And we expect the economy to achieve the full-year growth target in 2024, laying a solid foundation for a good opening in 2025," he noted.