China’s PMI Surpasses Pre-COVID Levels, Boosting Economic Recovery

In a report released on Wednesday, China’s manufacturing Purchasing Managers’ index (PMI) rose to 52.6 in February, beating market expectations and projecting that Chinese business activity grew more than expected in the last month. This figure surpassed pre-COVID levels and shows that the world’s second-largest economy in the world is recovering at a rapid pace.

On the split side, the non-manufacturing PMI had also performed well, rising to 56.3 in February, outdoing market expectations, again by 55.0, and standing above January’s 54.4 reading. The performance of both contributed to China’s Composite PMI jumping to 56.4, the fastest in 3 years.

The manufacturing sector, which contributes to more than 50% of Chinese business activities and GDP performed these months due to the increased government spending, lending rates being held at record low levels, and increased local liquidity, by the People’s Bank of China. Beijing has loosened funding laws for the country’s property sector announcing plans for more infrastructural projects as it moves to shore up growth. Ultimately, the zero-COVID policy was scaled back and the country’s borders were completely opened, boosting tourism and other industries.