BEIJING: China's manufacturing activity expanded in March for the first time since December, the government said on Wednesday, a bright spot as the world's second-largest economy fights a broad slowdown in growth.
The official Purchasing Managers' Index (PMI) released by the National Bureau of Statistics (NBS) came in at 50.1 last month, up from 49.9 in February and the first result showing expansion since a similar 50.1 in December.
The index, which tracks activity in factories and workshops, is considered a key indicator of the health of China's economy, a major driver of global growth. A figure above 50 signals growth, while anything below indicates shrinkage.
The data surprised economists, who attributed the improvement to official efforts to boost the slumping economy.
"After a string of disappointing data, the improvement in the official PMI is welcome news and suggests that the recent rate cuts and pick-up in bank lending growth may be helping to support large firms," Julian Evans-Pritchard, China economist at Capital Economics, wrote in a reaction to the data.
But he added that the economy still probably suffered a sharp slowdown in the first quarter of the year, meaning that more cuts in interest rates and bank reserve rations were likely.
The official PMI had shown contraction in January for the first time in more than two years, raising alarm bells for China's growth outlook.
China's economy expanded 7.4 percent in 2014, marking a 24-year low. The slowdown has prompted authorities to loosen monetary policy in a bid to put a brake on the weakness.
The government last month set its annual target for growth in gross domestic product (GDP) at about 7.0 percent, down from its aim of approximately 7.5 percent in 2014.
The central People's Bank of China (PBoC) has cut benchmark interest rates twice since November and has also lowered the amount of funds banks must keep on hand to boost lending and spark economic activity.
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