by XIN Yuan

The official manufacturing Purchasing Managers' Index (PMI) rose to 49.4 in August, up 0.1 percentage points from July, the National Bureau of Statistics said on Sunday.

WANG Qing, chief macro analyst at Golden Credit Rating, told Jiemian News the slight rebound reflected the fading impact of July's high temperatures and heavy rainfall, which had curbed infrastructure activity. He added that the outcome of mid-August trade talks between China and the US in Stockholm also helped lift sentiment.

The PMI sub-indices revealed uneven performance. The production index gained 0.3 points to 50.8, marking a fourth straight month of expansion, while new orders edged up only 0.1 points to 49.5, still in contraction. Input and factory-gate price indices rose for a third consecutive month to 53.3 and 49.1, respectively, suggesting some support for industrial profits.

XU Tianchen, senior economist at the Economist Intelligence Unit, said an upturn in manufacturing momentum could emerge from September, citing the rollout of policy-backed financial tools, fading weather disruptions and a potential narrowing of China's tariff disadvantage as the US raises reciprocal tariffs on other nations.

Policy support will also be key in sustaining growth, according to Wang. He noted that recent housing measures in Beijing and Shanghai, together with nationwide childcare subsidies, showed Beijing's resolve to boost domestic demand in the second half. With relatively low government debt and modest inflation, he sees room for the central bank to cut interest rates and the reserve requirement ratio again early in the fourth quarter, alongside stronger fiscal spending on "new infrastructure and new urbanization".

"These steps will help offset weaker external demand and keep the economy on track to meet annual development goals," Wang said.

Meanwhile, the non-manufacturing PMI rose 0.2 points to 50.3, supported by services activity at 50.5. Construction cooled, with its sub-index falling 1.5 points to 49.1.