China factory activity picks up in December as orders rise ahead of holidays

Official and private manufacturing PMIs each rose to 50.1 in December, marking the first expansion in eight months as orders increased ahead of year-end holidays.

Chinese factory activity expanded in December for the first time in eight months, with the official purchasing managers index rising to 50.1. A private-sector PMI also recorded 50.1. Surveys reported that orders picked up ahead of year-end holidays and builders rushed to finish projects. President Xi Jinping said he would promote "high-quality development" and carry out "more positive macroeconomic policies" at a New Year gathering. Key details: - The official manufacturing PMI rose to 50.1 in December, just above the 50 cutoff for expansion. - A private sector survey also recorded a 50.1 reading for December. - High-tech manufacturing PMI stood at 52.5 in December, up 2.4 percentage points from the prior month. - PMIs for equipment manufacturing and consumer goods reached 50.4, while measures for food, textiles, clothing and electronics were above 53. - Small and mid-sized enterprises remained in contractionary territory, and RatingDog reported new export sales fell slightly and hiring weakened. - RatingDog and some analysts noted higher raw-material costs led exporters to raise prices, and other analysts said structural headwinds from the property slump and industrial overcapacity are likely to persist into 2026. Summary: The December PMI readings show a modest end-of-year rebound driven by stronger orders and higher activity in some industries, particularly high-tech and larger manufacturers. Undetermined at this time.