China's Purchasing Managers' Index (PMI) for March returns to the expansionary territory

March China’s Purchasing Managers’ Index Returns to Expansion Territory

— Interpretation of China’s Purchasing Managers’ Index for March 2026 by Huo Lihui, Chief Statistician of the Service Industry Survey Center of the National Bureau of Statistics

On March 31, 2026, the Service Industry Survey Center of the National Bureau of Statistics and the China Federation of Logistics and Purchasing released China’s Purchasing Managers’ Index. In response, Huo Lihui, Chief Statistician of the Service Industry Survey Center of the National Bureau of Statistics, provided an interpretation.

In March, the manufacturing purchasing managers’ index, the non-manufacturing business activity index, and the composite PMI output index all returned to the expansion territory, at 50.4%, 50.1%, and 50.5% respectively, up by 1.4 percentage points, 0.6 percentage points, and 1.0 percentage point from the previous month, indicating a rebound in China’s economic momentum.

I. Manufacturing Purchasing Managers’ Index Rises to Expansion Territory

In March, as enterprises accelerated work resumption and production after the Spring Festival and market activity increased, the manufacturing PMI was 50.4%, returning to the expansion territory.

(I) Synchronized expansion on both the supply and demand sides. The production index and new orders index were 51.4% and 51.6% respectively, up 1.8 and 3.0 percentage points from the previous month; both rose to the expansion territory. Manufacturing firms’ production activities accelerated and market demand improved markedly. By industry, the production index and new orders index in sectors such as agricultural and sideline food processing, and non-ferrous metal smelting and rolling were both above 55.0%, with production and demand being released relatively quickly in related industries. In contrast, in sectors such as textiles, apparel, chemical fibers, and rubber and plastic products, both indices continued to remain below the critical point, and market activity was relatively weak. Driven by the recovery in production and demand, enterprises’ purchasing intentions strengthened, with the purchasing volume index at 50.9%, up 2.7 percentage points from the previous month.

(II) PMI rebounds across large-, medium-, and small-sized enterprises. The PMI for large enterprises was 51.6%, up 0.1 percentage point from the previous month, with business conditions rising steadily. The PMIs for medium- and small-sized enterprises were 49.0% and 49.3% respectively, up 1.5 and 4.5 percentage points from the previous month, showing a clear improvement in business conditions.

(III) Three major key sectors expand more quickly. The high-tech manufacturing PMI was 52.1%, up 0.6 percentage point from the previous month, staying above the critical point for 14 consecutive months, and the sector’s development trend continued to look positive. The equipment manufacturing industry and consumer goods industry PMIs were 51.5% and 50.8% respectively, up 1.7 and 2.0 percentage points from the previous month, and both rose to the expansion territory. The high energy-consuming industries PMI was 48.9%, up 1.1 percentage points from the previous month, and business conditions improved somewhat.

(IV) Price indexes rebound significantly. Influenced by recent continued increases in the prices of some bulk commodities and the acceleration of enterprise purchasing activity, the main raw materials purchase price index and the ex-factory price index were 63.9% and 55.4% respectively, up 9.1 and 4.8 percentage points from the previous month. Overall manufacturing market prices rebounded markedly. By industry, in sectors such as oil, coal, and other fuel processing, and chemical raw materials and chemical products, both price indexes were above 70.0%, and the overall procurement and sales prices in related industries rose notably.

(V) Market expectations rise steadily. The production and operating activity expectation index was 53.4%, up 0.2 percentage point from the previous month, showing that manufacturing enterprises had increased confidence in near-term market development. By industry, the production and operating activity expectation indexes in sectors such as special equipment, automobiles, railway, ships, and aviation and aerospace equipment were in a higher business conditions range, above 56.0%, and related enterprises were more optimistic about future sector development.

The survey results also show that, affected by factors including geopolitical conflicts in the Middle East, prices of relevant raw materials such as oil and chemicals rose sharply. Coupled with higher logistics freight rates, the share of enterprises this month reporting high raw material costs and high logistics costs both increased compared with the previous month.

II. Non-Manufacturing Business Activity Index Rebounds

In March, the non-manufacturing business activity index was 50.1%, up 0.6 percentage point from the previous month, and non-manufacturing business conditions improved.

(I) Service sector business activity index rises above the critical point. The service sector business activity index was 50.2%, up 0.5 percentage point from the previous month. By industry, the business activity indexes in sectors such as railway transport, telecommunications radio and television and satellite transmission services, money and financial services, and insurance were all in higher business conditions ranges above 55.0%, with total business volume growing relatively quickly. After the Spring Festival, the business activity indexes in sectors related to residents’ travel and consumption—such as retail, accommodation, and catering—were below the critical point, and market activity weakened somewhat. From the perspective of market expectations, the service sector business activity expectation index was 54.8%, continuing to remain at a relatively high level of operation, indicating that service sector enterprises are optimistic about recent market development.

(II) Construction industry business activity index improves. As local construction projects gradually resumed work after the holiday, the construction industry business activity index was 49.3%, up 1.1 percentage points from the previous month. From the perspective of market expectations, the construction industry business activity expectation index was 50.5%, above the critical point, indicating that construction enterprises maintain confidence in future sector development.

III. Composite PMI Output Index Rises Above the Critical Point

In March, the composite PMI output index was 50.5%, up 1.0 percentage point from the previous month, indicating that the overall business conditions of China’s enterprises’ production and operations are improving. The manufacturing production index and the non-manufacturing business activity index that make up the composite PMI output index were 51.4% and 50.1% respectively.

(Editor: Wenjing)

Keywords:

                                                            PMI