Factory activity returns to expansion in a positive sign for China's economy
A worker labors on the production line of high caliber carbon fiber in Lianyungang in eastern China's Jiangsu province, Sept. 15, 2026. Credit: AP/Uncredited
HONG KONG — China’s factory activity expanded in September for the first time in three months, striking a more positive tone as Chinese officials look to bolster economic growth.
The official manufacturing purchasing managers’ index, or PMI, climbed to 50.1 from 49.8 in August, China’s National Bureau of Statistics said Wednesday. The index reading, based on an official monthly survey of companies, was in line with what economists had expected.
PMI is measured on a scale of between 0 and 100 and a reading above 50 reflects an expansion.
Several subindexes remained in expansion territory. The subindex on production rose to 51.7 from 50.4 in August. The subindex on new orders was at 50.5, down slightly from 50.6, while new export orders eased to 50.0 from 50.1.
A separate private survey, the RatingDog PMI, also showed China’s manufacturing PMI advanced to 52.1 in September from 51.5 in August, indicating improvements in the manufacturing sector.
Wednesday’s reports came ahead of China’s weeklong October national holiday in which domestic consumption and spending are closely watched by policymakers.
They also followed new key measures announced in China on Tuesday to support its economy, including new subsidies for Chinese homebuyers’ mortgage interest payments.
A woman selects tennis shaped keychain on sale at a souvenir store during the China Open tennis championships in Beijing, Wednesday, Sept. 30, 2026. Credit: AP/Andy Wong
China’s economy has been under growing pressure of a slowdown as domestic demand and investment remained sluggish, in part hit by weaknesses in the property sector, even as the global artificial intelligence boom has buoyed Chinese exports of high-tech goods.
“Manufacturing has been a relative strength this year, though it has mostly been driven by external demand as domestic consumption and investment lag,” Lynn Song, chief economist for Greater China at ING Bank, wrote in a commentary.
Some economists believe China is on track to surpass last year’s record $1.2 trillion trade surplus. Recent improvements in U.S.-China relationships, including a two-month extension of a trade truce between the two superpowers until January, are likely to help improve bilateral trade.
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