Beijing: China's manufacturing activity experienced a contraction in January as the manufacturing purchasing managers' index (PMI) fell 2.1% to 49.1 from 50.1 in December, as per data released by the National Bureau of Statistics (NBS) on Monday.

According to Anadolu Agency, the new orders subindex within the PMI dropped to 49.2, down from 51 in the previous month. The subindex for new export orders also decreased to 46.4, compared to 48.3 in December, showing a decline in demand from international markets.

The non-manufacturing sector also faced challenges, with the construction sector subindex falling to 49.3 in January from 53.2 in December. The industry's new orders index showed a significant drop to 44.7 from 51.4 in the previous month, indicating reduced activity in construction projects.

A PMI reading below 50 signals contraction in the manufacturing sector, highlighting the challenges faced by the industry. The NBS reported that the nation's industrial profits decreased by 3.3% in 2024 compared to the previous year, despite an 11% increase in December.

Profits for the year varied across different types of businesses, with government-owned companies experiencing a 4.6% decline and foreign-invested businesses, including those from Taiwan, Hong Kong, and Macau, seeing a 1.7% decrease. In contrast, private businesses managed to increase profits by 0.5%.