China's Manufacturing Activity Rebounds in February

China's manufacturing sector experienced a significant rebound in February, with the manufacturing purchasing managers' index (PMI) rising to 50.2 from 49.1 in January, according to data released by the National Bureau of Statistics (NBS). This marks the highest reading since November 2024 and indicates a return to expansion in the manufacturing industry.

The rebound in manufacturing activity can be attributed to several key indicators that showed improvement in February:

1. Production: The production index rose to 52.5% in February, up from 49.8% in January. This indicates a significant acceleration in manufacturing activity, as the index moved above the 50% threshold, signaling expansion.
2. New Orders: The new orders index also increased to 51.1% in February, up from 49.2% in January. This suggests that demand for manufactured goods improved, driving the rebound in production.
3. Supplier Delivery Time: The supplier delivery time index rose to 51.0% in February, up from 50.3% in January. This indicates that suppliers' delivery times improved, which can be attributed to better supply chain management and increased efficiency.

These indicators show a clear improvement in manufacturing activity compared to January 2025. The production index, in particular, experienced a notable increase, indicating a strong recovery in manufacturing output. The new orders index also contributed to this rebound, as improved demand drove production growth. Additionally, the supplier delivery time index suggests that supply chain issues, which had previously impacted manufacturing activity, began to ease in February.

The rebound in manufacturing activity is a positive sign for the Chinese economy, as it suggests that the sector is recovering from the slowdown experienced in recent months. However, it is essential to monitor the situation closely, as the recovery may still be fragile and subject to various risks and uncertainties.