China’s manufacturing sector showed signs of contraction in April, with the Purchasing Managers’ Index (PMI) slipping to 49.0 from 50.5 in March, according to data released by the National Bureau of Statistics (NBS) on Wednesday. A PMI reading below 50 indicates a contraction in manufacturing activity, while a reading above 50 signals expansion.
This decline ends two consecutive months of growth, reflecting challenges in the global economic environment and ongoing trade tensions. Despite the dip, optimism remains among industry experts who believe that the impact on the supply side is limited.
The supplier delivery time index, a component of the PMI, stood at 50.2, slightly down by 0.1 points from the previous month. This indicates that the delivery times of raw material suppliers are continuing to accelerate.
Non-manufacturing business activities continued to expand, with the index coming in at 50.4 compared to 50.8 in March. As a result, China’s comprehensive PMI, which combines both manufacturing and non-manufacturing sectors, stood at 50.2, remaining above the critical threshold.
The Caixin General Manufacturing PMI, a private survey often seen as a gauge of smaller and medium-sized enterprises, registered at 50.4 in April 2025. Although this is a decrease from March’s four-month high of 51.2, it marks the seventh consecutive month of expansion, signaling ongoing growth in the sector.
Dr. Wang Zhe, senior economist at Caixin Insights Group, commented on the data, stating, “Both supply and demand grew at a slower pace, but market conditions continue to improve.” Despite a slower increase in new orders due to weakened external demand and trade disruptions, Dr. Wang remains positive about the outlook. He noted that manufacturers are still fulfilling existing orders and that the impact of tariffs has been relatively limited.
As China navigates global economic headwinds, the continued expansion in non-manufacturing activities and the sustained optimism among industry experts suggest resilience in the world’s second-largest economy.
