China's factory activity slumps more than expected in February as holiday disrupts production

China’s factory activity faltered in February as manufacturers paused production and cargo shipment to celebrate an extended holiday, an official survey showed on Wednesday.

The official manufacturing purchasing managers index fell to 49 in February, according to the National Bureau of Statistics, missing economists’ forecast for 49.1. A reading below 50 indicates contraction, while levels above that threshold signal expansion.

That marks a second straight month of contraction, with PMI reading matching October and April 2025 levels. The official PMI had come in at 49.3 in January following a brief rebound in December.

The composite PMI, a broader measure that tracks activity across manufacturing and services, dropped to 49.5 from 49.8 in January, the official data showed.

The non-manufacturing PMI, which covers services and construction, edged 0.1 percentage point to 49.5.