China’s Factory PMI Falls to 49.3 in October as Export Orders Shrink

Photo: Bruno Corpet, Wikimedia Commons, CC BY-SA 3.0 (file photo, 2013). Containers at Shanghai’s Yangshan deep-water port.

China’s factory sector slipped back into contraction in October. The official China manufacturing PMI fell to 49.3 from 50.1 in September, the National Bureau of Statistics (NBS) and the China Federation of Logistics and Purchasing said Saturday, Oct. 31, in a release published at 9:30 a.m. Beijing time (9:30 p.m. ET Friday). A reading below 50 means more purchasing managers reported worsening conditions than improving ones.

The result missed the 50.0 forecast in a Reuters poll and marked the third contraction in four months, Reuters reported in a story carried by CNA. The wider economy also cooled: the non-manufacturing business activity index, which covers services and construction, dropped 0.5 points to 49.7, and the composite output index fell a full point to 49.7.

Output, orders and exports all below 50

All the main demand and production gauges weakened at once. The production sub-index fell 1.9 points to 49.8 and the new orders index fell 1.1 points to 49.4, according to the NBS tables. The new export orders index dropped to 48.7 from 50.0, and the import index fell to 47.0. Employment held at 48.4, unchanged from September, while supplier delivery times edged up to 50.2, which in this survey signals slightly faster deliveries.

Reuters said overseas Christmas-related orders that factories had pulled forward into September cooled in October, and that consumer spending, which rose during the weeklong National Day holiday at the start of the month, faded once the break ended. “Insufficient demand is increasing downward pressure on the economy,” Zhang Liqun, an analyst with the China Federation of Logistics and Purchasing, told the news agency, adding that policymakers should take the problem seriously and step up measures as soon as possible.

Size mattered. Large manufacturers stayed just above the line at 50.2, down 0.4 points, while medium-sized firms fell 1.3 points to 48.4 and small firms fell 1.4 points to 47.5, the release showed. Smaller companies tend to be more exposed to domestic consumer demand and to tight credit.

High-tech factories keep growing

Not every industry pulled back. The high-tech manufacturing PMI was 51.3 and equipment manufacturing was 50.6, both in expansion, according to an official interpretation by NBS chief statistician Huo Lihui. Production and new-order indexes for railway, shipbuilding and aerospace equipment, and for computer, communications and electronics makers, were at 53.0 or higher. By contrast, the consumer goods PMI fell 1.9 points to 48.8 and energy-intensive industries slipped 0.7 points to 47.3. Textiles, non-metallic mineral products and non-ferrous metal smelting were below 50 on both output and orders.

Huo attributed the overall decline to some demand being brought forward before the October holiday and to a “complex and changeable” international environment. That is the statistics bureau’s own explanation and has not been independently tested. Xinhua, China’s state news agency, carried the same framing !Unverified claim, Xinhua (Chinese state media).

Prices cool from high levels

Cost pressure eased but did not disappear. The main raw-material purchase price index fell 4.0 points to 56.8 and the output (factory-gate) price index fell 2.3 points to 51.7, both still above 50, which means more firms reported rising prices than falling ones. Huo linked the drop to recent declines in some non-ferrous metal prices. She said petroleum and coal processing, chemical fibers, and rubber and plastics makers had both price gauges above 60 as international crude prices kept climbing.

By the numbers: how October compares

TBR calculations from the NBS monthly table show how unusual October’s swing was:

• At 49.3, the headline PMI is the lowest since July (49.2). It is not a multi-year low: the index was 49.0 in both October 2025 and February 2026, so October’s reading is 0.3 points higher than a year earlier.
• The PMI has been below 50 in seven of the last 13 months, and its average over the past 12 months (November 2025 to October 2026) is 49.75.
• New export orders at 48.7 are the weakest since May (48.6).
• The production index’s 1.9-point drop is the largest monthly move in either direction in the 13-month series. The next largest are a 1.8-point rise in March and a 1.5-point fall in July.

Construction drags; services stall

Outside manufacturing, construction was the weak spot. The construction business activity index fell 2.3 points to 48.0, and its new-orders index plunged 5.7 points to 40.0, the release showed. Services activity edged down 0.2 points to exactly 50.0. Huo said a sharp drop in financial-sector activity was the main reason services slipped, while holiday-linked sectors such as rail transport, lodging, and culture, sports and entertainment rose and stayed in expansion. Capital-market services, insurance and real estate were all below 50.

What it means for growth and policy

The weak survey lands days after the People’s Bank of China said it would run overnight reverse repos every working day at 1.25%, a technical step in how it steers short-term rates. China’s economy grew 4.5% from a year earlier in the third quarter, up from 4.3% in the second, according to the NBS GDP release, and Reuters reported that Beijing is still expected to meet its 4.5% to 5% growth target for the year without additional stimulus.

For U.S. readers, the export-orders figure is the one to watch. A drop in foreign orders after a September rush suggests holiday-season shipments to Western retailers were pulled forward rather than lost, but the survey cannot show which markets softened. China’s private-sector manufacturing survey, compiled by S&P Global, was not yet out when the official data were released. For the day’s U.S. market moves, see our Oct. 30 business report, and for this week’s politics in Beijing, our report on the Communist Party’s fifth plenum.

Sources

• National Bureau of Statistics of China: October 2026 PMI release (Chinese), tables 1-3
• NBS: Huo Lihui’s interpretation of the October 2026 PMI (Chinese)
• Reuters via CNA: China’s factory activity marks third contraction in four months
• NBS: Third-quarter 2026 GDP release

Additional sources

• Xinhua (Chinese state media): October PMI report