China’s PMI Fluctuates in February 2026, Driven by Spring Festival Holiday with Positive Long-Term Expectations

On March 4, 2026, the Service Industry Survey Center of the National Bureau of Statistics and the China Federation of Logistics and Purchasing jointly released China’s Purchasing Managers’ Index (PMI). In PMI terms, a reading above 50% indicates expansion, while below 50% signals contraction. Affected by factors such as the Spring Festival holiday, the manufacturing PMI stood at 49.0% in February, down 0.3 percentage points from the previous month; the non-manufacturing business activity index was 49.5%, up 0.1 percentage points month-on-month; and the composite PMI output index was 49.5%, a decrease of 0.3 percentage points from the previous month.

Manufacturing PMI Edges Down Slightly

The manufacturing PMI fell to 49.0% in February, with its prosperity level declining month-on-month. Historical data shows that PMI usually fluctuates in the month of the Spring Festival. Particularly this year, the Spring Festival holiday was extended to 9 days, falling entirely in the middle and late February, which had a certain impact on enterprises’ production and operation and led to a slight decline in the overall activity of the manufacturing market.

Both production and demand slowed down: the production index and new orders index were 49.6% and 48.6% respectively, down 1.0 and 0.6 percentage points from the previous month. From an industry perspective, industries such as agricultural and sideline food processing, and computer communication and electronic equipment maintained expansion, with both indices above the 50% threshold; while industries including textile, clothing and apparel, and automobiles remained below the threshold, with relatively weak market activity.

Large enterprises continued to expand, with their PMI rising 1.2 percentage points to 51.5% and maintaining production and operation expansion. Medium and small enterprises were more affected by the Spring Festival holiday, with their PMI falling to 47.5% and 44.8% respectively, down 1.2 and 2.6 percentage points month-on-month.

High-tech manufacturing maintained strong growth momentum, with its PMI at 51.5%, remaining in the expansion range and significantly higher than the overall manufacturing level. The consumer goods industry PMI rose 0.5 percentage points to 48.8%, showing a recovery in prosperity; the equipment manufacturing and high-energy-consuming industries saw their PMI fall slightly to 49.8% and 47.8% respectively.

Enterprise expectations turned positive: the production and operation activity expectation index rose 0.6 percentage points to 53.2%, indicating that manufacturing enterprises had strengthened confidence in market development after the Spring Festival. Industries such as general equipment, and railway, ship and aerospace equipment had expectation indices above 56.0%, reflecting greater optimism among related enterprises.

Non-Manufacturing Business Activity Index Rises Slightly

The non-manufacturing business activity index edged up 0.1 percentage points to 49.5% in February, showing an improvement in the overall prosperity of the non-manufacturing sector.

The service industry saw a recovery in prosperity, with its business activity index rising 0.2 percentage points to 49.7%. Driven by the Spring Festival holiday effect, industries related to residents’ travel and consumption grew rapidly: the business activity indices of accommodation, catering, culture, sports and entertainment were all above 60.0%, while those of retail and air transportation rose to above 52.0%. The service industry business activity expectation index remained at a high level of 55.8%, indicating optimistic market expectations among service enterprises.

The construction industry’s prosperity declined, with its business activity index falling 0.6 percentage points to 48.2% due to factors such as employees returning home for the holiday and suspension of some construction projects. However, the construction industry’s business activity expectation index rose 1.1 percentage points to 50.9%, returning above the 50% threshold and reflecting restored confidence in the industry’s future development.

Composite PMI Output Index Declines

The composite PMI output index fell 0.3 percentage points to 49.5% in February, indicating a slight slowdown in China’s overall enterprise production and operation activities compared with the previous month. The manufacturing production index and non-manufacturing business activity index, which constitute the composite PMI output index, were 49.6% and 49.5% respectively.

Overall, the slight fluctuations in China’s PMI in February were mainly affected by the extended Spring Festival holiday, which is a normal seasonal phenomenon. With positive enterprise expectations across various sectors, the economy is expected to gradually recover and maintain a steady development trend as the holiday effect fades.