PMI surges to 50.8 in March, returning to expansion territory

China’s official manufacturing purchasing managers’ index (PMI) returned to expansion range in March after running below 50 for five consecutive months, the National Bureau of Statistics (NBS) said on Sunday, as manufacturing activity increased with the fast resumption of work and production following the Spring Festival holidays.

The figure, although partly driven by the seasonal factor, showed that the economic recovery has further consolidated, highlighting the resilience of the Chinese economy, experts said, and they are more confident about GDP growth in the first quarter.

In March, the manufacturing PMI came in at 50.8 amid an increase in market activity, up from 49.1 a month earlier, returning to expansion territory.

The manufacturing sector has seen a recovery of production and strong market demand, with the production sub-index reaching 52.2 in March, up 2.4 points from the previous month, while the new orders index surged to 53.0.

Manufacturing activities expanded in March with the rapid resumption of work and production after the Spring Festival holidays, as the sector showed a significant expansion in business conditions, according to NBS senior statistician Zhao Qinghe.

In the survey of 21 industrial lines, 15 returned to expansion territory, an increase of 10 from the previous month, said Zhao.

Experts believe the return of the PMI to the expansion range shows that China’s economy is bottoming out and rebounding, and economic growth was substantial in the first quarter.

With the PMI reaching 50.8 and other indicators such as fixed-asset investment and retail sales rising, China’s economy showed signs of recovery in the first quarter, said Cao Heping, an economist at Peking University,

“The GDP growth rate could have reached 5.2 percent in the first quarter, which is quite optimistic,” Cao said.