The economy Weak demand weighs on sentiment in China's industry
Weak demand at the beginning of the year caused a surprising decline in business activity in China's industry. As a result, the mood in the country's companies deteriorated again, according to a statement from the statistics office in Beijing.
31.01.2026, 05:45
SDA
The Purchasing Managers' Index (PMI) for the manufacturing sector reached 49.3 points in January. Analysts had previously expected this important leading indicator to be just above 50 points, i.e. exactly the threshold above which business activity is expected to expand, while values below this point to a decline.
Statisticians from the world's second-largest economy attributed the development to the "traditional low season" in parts of the manufacturing industry.
Beijing focuses on consumption
In the non-manufacturing sector, which includes the construction sector and the service industry, the index also fell below the 50 mark to 49.4 points. This means that there is still no positive signal for the economy at the start of the year, after the PMI for the manufacturing sector reached 50.1 points again in December following an eight-month decline in sentiment.
China's export-driven economy is struggling with weak domestic demand. An accompanying price war in many sectors is putting pressure on the profitability of many companies.
The government's plans to boost consumption with trade-in programs and discounts, for example, and to expand the service sector in order to support the economy have been met with scepticism. According to experts, Beijing would have to create confidence with measures such as strengthening social security so that households spend money again instead of saving it for a rainy day.
