China’s February PMI data revealed a widening divide between official indicators and private surveys, highlighting the uneven nature of the country’s economic transition.
The official manufacturing PMI, released by the National Bureau of Statistics of China, slipped to 49.0 from January’s 49.3, missing expectations and marking a second consecutive month of contraction. Activity in services and construction also stayed weak, with the non-manufacturing PMI edging slightly up from 49.4 to 49.5.
However, private-sector surveys paint a starkly different picture. According to data compiled by RatingDog, manufacturing PMI surged from 50.3 to 52.1, its strongest level since December 2020. The services PMI jumped even more sharply, rising to 56.7, the highest reading in nearly three years.
This divergence suggests a “dual-track” economy emerging in China. State-dominated sectors tied to construction and traditional heavy industry appear to be cooling, while private, export-oriented firms are experiencing a resurgence in demand, particularly in higher-value manufacturing and technology-linked industries.
Part of the discrepancy may also reflect seasonal distortions around the Lunar New Year. Large state factories often shut down for extended periods during the holiday, while smaller and more flexible private firms tend to ramp up production quickly to capture early-year export orders.
The February data may therefore capture both the growing pains of China’s structural shift toward “new productive forces” and the short-term disruptions created by the holiday cycle.
