China's Non-Manufacturing Sector Expands In February 2025, Indicating Economic Recovery

China's non-manufacturing sector showed continued growth in February, indicating a steady recovery in economic output. Official data from the National Bureau of Statistics (NBS) revealed that the non-manufacturing business activity index reached 50.4% in February, marking a 0.2% increase from January. An index reading above 50 signals expansion, while below 50 indicates contraction.

The construction industry experienced a boost since the Spring Festival holiday ended in early February. Warmer weather and resumed investment projects contributed to this growth. The industry's business activity index rose to 52.7%, an increase of 3.4% compared to January.

Huo Lihui, head of the Business Climate Survey Division at the Service Survey Center under NBS, noted significant growth in several sectors. "In terms of industries, the business activity index of air transport, postal services, telecommunications, radio and television and satellite transmission services, capital market services and monetary and financial services was in a high expansion range of more than 55.0%, and the total business volume in these industries went up relatively rapidly," he said.

He Hui, Deputy Head of the China Federation of Logistics and Purchasing, highlighted increased investment demand post-Spring Festival. "Since the conclusion of the Spring Festival holiday season, China's investment demand has been revitalized. Construction companies have expedited their work resumption, leading to a notable acceleration in construction activities. The increase observed across various sub-sectors indicates that infrastructure investment-related activities have been particularly remarkable," he stated.

The official Spring Festival holiday this year spanned from January 28 to February 4. This festival marks the start of the Chinese New Year and is considered the most important holiday for family gatherings in China.

The positive trends across various sectors suggest that China's economy is on a path to recovery following disruptions caused by previous challenges. With key industries showing robust performance, there is optimism for sustained economic growth in the coming months.

With inputs from WAM