China’s November 2025 NBS Manufacturing PMI: A Subtle Shift Amid Lingering Challenges
Table of Contents
Big-Picture Snapshot
The National Bureau of Statistics (NBS) Manufacturing PMI for China in November 2025 registered at 49.20, unchanged from the consensus estimate and a modest improvement from October’s 49.00. This figure remains below the 50-point mark that separates expansion from contraction, indicating ongoing weakness in the manufacturing sector. The PMI has hovered below 50 for three months consecutively, a trend not seen since mid-2024, when the index averaged 49.30 during a similar slowdown phase.
Drivers this month
- New orders stabilized at 48.90, slightly better than October’s 48.50, reflecting cautious demand.
- Output contracted at 49.00, improving from 48.70 last month but still under pressure.
- Supplier delivery times lengthened marginally, signaling supply chain frictions.
- Employment remained weak at 48.50, consistent with subdued hiring.
Policy pulse
The PMI remains below the neutral 50 threshold, underscoring the need for continued monetary and fiscal support. The People’s Bank of China (PBOC) has maintained accommodative policies, including targeted lending facilities and interest rate cuts earlier this year. Fiscal authorities have increased infrastructure spending by 5.50% YoY in Q3 2025, aiming to offset private sector weakness.
Market lens
Following the PMI release, the CNHCNH currency pair saw a mild depreciation of 0.15%, reflecting cautious investor sentiment. The SHCOMP index dipped 0.30% in early trading, mirroring concerns over manufacturing softness. Meanwhile, short-term yields on Chinese government bonds remained stable, indicating steady monetary policy expectations.
Foundational Indicators
The November PMI reading of 49.20 contrasts with the 12-month average of 49.70, highlighting a persistent but mild contraction in manufacturing activity. Historically, the PMI peaked at 50.50 in March 2025, reflecting a brief expansion phase before the sector’s gradual slowdown. The current level is comparable to readings in April and October 2025, both at 49.00, suggesting a plateau in manufacturing weakness.
Monetary Policy & Financial Conditions
The PBOC’s benchmark lending rate remains at 3.45%, unchanged since September 2025, supporting liquidity. Credit growth to the manufacturing sector slowed to 6.80% YoY in November, down from 7.20% in October, indicating cautious bank lending amid risk aversion. The broad money supply (M2) grew 9.10% YoY, slightly below the 9.30% average for 2025, reflecting moderate monetary easing.
Fiscal Policy & Government Budget
Fiscal stimulus continues to underpin the economy, with the government allocating CNY 2.30 trillion to infrastructure and technology upgrades in 2025. The budget deficit widened to 3.20% of GDP in Q3, up from 2.90% in the previous quarter, signaling increased government spending to counteract economic headwinds.
External Shocks & Geopolitical Risks
Trade tensions with key partners, notably the US and EU, have persisted, affecting export orders. Tariff uncertainties and supply chain disruptions remain significant risks. Additionally, energy price volatility and regional geopolitical frictions in the Asia-Pacific region contribute to manufacturing sector caution.
Chart Dynamics
Supplier delivery times lengthened marginally, with the supplier delivery index at 51.20, up from 50.80 in October, indicating ongoing supply chain delays. Employment remained weak, with the employment index steady at 48.50, consistent with cautious hiring practices.
This chart signals a manufacturing sector that is stabilizing but not yet expanding. The PMI’s slow recovery from recent lows suggests that while immediate deterioration has eased, significant headwinds remain. The sector’s health will depend on sustained domestic demand and easing external pressures.
Market lens
Immediate reaction: The BTCUSD crypto pair saw a 0.40% dip within the first hour, reflecting risk-off sentiment linked to manufacturing softness. The 000001.SZ Shenzhen Composite index declined 0.25%, mirroring the cautious tone in equity markets.
Forward Outlook
Looking ahead, the manufacturing PMI’s trajectory suggests three plausible scenarios for China’s industrial sector over the next six months:
- Bullish (30% probability): Domestic demand recovers strongly, supported by renewed fiscal stimulus and easing geopolitical tensions. PMI rises above 50.50 by Q2 2026, signaling expansion.
- Base (50% probability): Manufacturing activity stabilizes around the current level (49.00–49.50), with modest improvements offset by global demand softness and supply chain constraints.
- Bearish (20% probability): External shocks intensify, including trade restrictions and energy price spikes, pushing PMI below 48.50 and deepening contraction.
Structural & Long-Run Trends
China’s manufacturing sector is undergoing a structural shift toward higher value-added production and green technologies. Despite short-term softness, investments in automation and digitalization are expected to support long-term productivity gains. The government’s “Made in China 2025” initiative continues to drive innovation, although benefits will materialize gradually.
Policy pulse
Monetary policy is expected to remain accommodative, with the PBOC ready to deploy targeted credit measures if downside risks materialize. Fiscal policy will likely maintain a proactive stance, focusing on infrastructure and technology sectors to stimulate growth.
Closing Thoughts
The November 2025 NBS Manufacturing PMI reading of 49.20 reflects a manufacturing sector in mild contraction but showing signs of stabilization. While the index remains below the expansion threshold, the slight improvement from October and the steady sub-indices suggest that the worst may be behind. However, persistent external risks and cautious domestic demand temper optimism.
Policymakers face a delicate balancing act: sustaining stimulus without overheating the economy or exacerbating debt risks. Market participants should monitor upcoming PMI releases, credit growth data, and geopolitical developments closely. The manufacturing sector’s trajectory will be a bellwether for China’s broader economic health in 2026.
Key risks include renewed trade tensions and supply chain disruptions, while upside potential hinges on effective policy support and global demand recovery.
Key Markets Likely to React to NBS Manufacturing PMI
The NBS Manufacturing PMI is a critical gauge of China’s industrial health, influencing multiple asset classes. Equity indices like the SHCOMP and 000001.SZ often move in tandem with PMI shifts, reflecting investor sentiment on growth prospects. The CNHCNH currency pair reacts to changes in trade outlook and capital flows. In crypto markets, BTCUSD can exhibit risk-on/risk-off dynamics linked to PMI surprises. Finally, bond yields and credit spreads are sensitive to PMI trends, affecting fixed income markets.
Insight Box: NBS Manufacturing PMI vs. SHCOMP Index Since 2020
| Year | Average PMI | SHCOMP Annual Return (%) |
|---|---|---|
| 2020 | 51.20 | 13.90 |
| 2021 | 50.80 | 3.10 |
| 2022 | 49.50 | -15.10 |
| 2023 | 49.80 | 7.90 |
| 2024 | 49.30 | 2.40 |
| 2025 (YTD) | 49.70 | 1.80 |
The correlation between the NBS Manufacturing PMI and the SHCOMP index remains positive but moderate, with PMI declines often preceding equity market softness. The 2022 downturn exemplifies this relationship, where PMI contraction coincided with a sharp equity selloff.
FAQ
- What does the NBS Manufacturing PMI indicate about China’s economy?
- The PMI measures manufacturing sector health; readings below 50 indicate contraction, signaling slower industrial activity and potential economic headwinds.
- How does the November 2025 PMI compare historically?
- At 49.20, it is below the 12-month average of 49.70 and marks the third consecutive month of contraction, reflecting ongoing but mild manufacturing weakness.
- What are the main risks affecting China’s manufacturing outlook?
- Key risks include global demand softness, trade tensions, supply chain disruptions, and energy price volatility, balanced by domestic stimulus efforts.
Takeaway: China’s manufacturing sector remains under pressure but shows tentative signs of stabilization, with policy support critical to reversing contraction trends in 2026.
This has been drafted with AI assistance and then thoroughly reviewed, refined, and approved by our human editorial team to ensure accuracy, and originality.
SHCOMP – China’s Shanghai Composite Index, closely tracks manufacturing sector health and economic growth.
000001.SZ – Shenzhen Composite Index, sensitive to domestic industrial activity and investor sentiment.
CNHCNH – Offshore Chinese yuan currency pair, reacts to trade outlook and capital flows linked to manufacturing.
BTCUSD – Bitcoin/USD pair, reflects risk appetite shifts influenced by macroeconomic data including PMI.
000002.SZ – Vanke Co., Ltd., a major real estate developer whose performance correlates with industrial demand and construction activity.
The November 2025 NBS Manufacturing PMI at 49.20 marks a slight improvement from October’s 49.00 but remains below the 12-month average of 49.70. The chart reveals a persistent sub-50 trend since April 2025, indicating ongoing contraction in manufacturing activity. The index’s trajectory suggests a stabilization phase rather than a sharp rebound.
Compared to the peak of 50.50 in March 2025, the current PMI reflects a 2.60-point decline, underscoring the sector’s struggle to regain momentum. The new orders and output sub-indices show parallel patterns, with new orders at 48.90 and output at 49.00, both slightly improved from last month but still contracting.