China’s Factory PMI Falls to 49.3 in October as All Three Official Gauges Dip Below 50

By The Edge Research Team

China’s official manufacturing purchasing managers’ index fell to 49.3 in October from 50.1, back below the line that separates expansion from contraction, the National Bureau of Statistics said on Saturday.

All three official gauges ended October below 50, a month after all three sat above it, with the non-manufacturing and composite indexes both at 49.7. The drop is uneven, though: large manufacturers, high-tech and equipment makers still expanded, and services sat exactly at 50.0.

In The Edge’s reading, October looks more like a payback for demand brought forward into September than a broad turn. The external side is the weaker link, with export orders and imports both at their lowest in months.

Huo Lihui, chief statistician of the bureau’s Service Industry Survey Center, tied the factory slowdown to factors including some demand being released early, before the National Day holiday, and a complex and changeable international environment.

The survey, published with the China Federation of Logistics and Purchasing, covers 3,200 manufacturers in 31 industry divisions. It also covers 4,300 non-manufacturing firms in 43 divisions. All indexes are seasonally adjusted, and a reading above 50 means activity grew from the month before.

Production and new orders account for the factory drop

The headline blends five sub-indexes, and new orders and production carry more than half of the weight between them. Production fell to 49.8 from 51.7. New orders fell to 49.4 from 50.5.

Applying the bureau’s published weights, The Edge calculates that production took 0.48 points off the headline and new orders 0.33. Between them that is the whole 0.8 point fall; the other three sub-indexes almost cancelled each other out.

Employment was unchanged at 48.4, and raw-material inventory edged up to 48.4, a smaller decline in stocks. The supplier delivery index rose to 50.2, meaning deliveries came faster; because it enters the headline inverted, its rise subtracted a fraction.

The bureau’s industry examples show a wide spread. Railway, shipbuilding and aerospace equipment, and computers and electronics, posted production and new orders indexes at 53.0 or higher. Textiles, non-metallic mineral products and non-ferrous metal smelting were below 50 on both.

Manufacturing PMI and sub-indexes (index points)

Seasonally adjusted. Headline weights: new orders 30%, production 25%, employment 20%, supplier delivery 15%, raw-material inventory 10%. Supplier delivery enters the headline inverted; a reading above 50 means faster deliveries.

Export orders and price gauges retreat from September

New export orders fell to 48.7 from 50.0, the lowest since May. They still stand 2.8 points above their level of October 2025.

Imports dropped to 47.0 and the backlog of orders to 44.1, both the lowest since February. Firms also bought less, with the purchase quantity index down to 48.9 from 51.0.

Prices are still rising, but more slowly. The input price index eased to 56.8 from 60.8, and output prices slipped to 51.7. The bureau linked the slowdown to recent falls in the prices of some non-ferrous metals and other commodities.

Fuel-related prices stayed high. With international crude prices still climbing, both price indexes stayed above 60.0 for petroleum, coal and other fuel processing, and for chemical fibres, rubber and plastics, the bureau said. The gap between the input and output indexes narrowed to 5.1 points from 6.8.

Firm size split the picture: large firms slipped to 50.2 and stayed in expansion, while medium firms fell to 48.4. Small firms dropped to 47.5. The gap between large and small firms widened to 2.7 points from 1.7.

High-tech manufacturing eased to 51.3 and equipment manufacturing to 50.6, both still expanding. Consumer goods makers fell to 48.8 and energy-intensive industries to 47.3.

Manufacturing by sector and firm size (index points)

September sector and size readings are from the bureau’s reading of 30 September 2026; October readings from its release and reading of 31 October 2026.

Services sit at 50 while construction slows

The non-manufacturing business activity index fell to 49.7 from 50.2. Services eased to exactly 50.0, while construction dropped to 48.0. Construction had reached its high for the year, 50.3, in September.

Inside services, the bureau’s reading said activity rose in all the main service categories. Railway transport, accommodation, and culture, sports and entertainment, the industries tied to holiday travel, rose markedly and stood in expansion. Water transport, postal services and internet software and IT services were above 55.0. Finance was the exception, falling by a large margin, which the bureau named as the main reason services slipped.

The release itself lists capital market services, insurance and real estate below 50.

Demand indicators fell further than activity: non-manufacturing new orders dropped to 44.4, back to July’s level. Construction new orders fell to 40.0, a drop of 5.7 points. Services new orders eased to 45.2.

Hiring fared better than orders. The non-manufacturing employment index edged up to 46.0, its best reading since January and level with February. Services employment rose to 46.7, while construction employment fell to 42.0.

Business expectations eased to 54.7 and stayed above 50, which the bureau said shows firms remain confident. Services expectations stood at 55.2 and construction at 52.3. Non-manufacturing input prices rose more slowly, at 51.5, while selling prices slipped to 49.5.

The composite output index, which blends factory production with non-manufacturing activity weighted by each side’s share of GDP, fell to 49.7 from 50.7. Factory production stood at 49.8 and non-manufacturing activity at 49.7, so neither input was in expansion.

Non-manufacturing indexes (index points)

Seasonally adjusted. Services and construction readings for September are from the bureau’s reading of 30 September 2026.

The factory index averages 49.8 over ten months

October’s factory reading is the lowest since July’s 49.2. It is still 0.3 points above the 49.0 of a year earlier.

From January to October the manufacturing index averaged 49.8. It sat above the line in four of those months and exactly on it in May.

The non-manufacturing index averaged 49.7 over the same months, also above the line in four of them. A year earlier it stood at 50.1, so October’s reading is 0.4 points lower.

Monthly official PMIs, 2026 (index points)

Factory is the manufacturing PMI; non-factory is the non-manufacturing business activity index. Seasonally adjusted, as published on 31 October 2026.

What to watch: October consumer and producer prices on 9 November at 01:30 GMT. October industrial production and energy output follow on 16 November at 02:00 GMT, and the November PMIs on 30 November at 01:30 GMT, on the bureau’s release calendar.

Figures are from the bureau’s release and reading of 31 October 2026 and its reading of 30 September 2026; averages, gaps, contributions and comparisons not attributed to the bureau are The Edge’s calculations.

Sources: National Bureau of Statistics of China, China Federation of Logistics and Purchasing, The Edge.

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