PMI Quarterly On China Manufacturing – Issue 62 (October 2025)

Supply Chain
PMI Quarterly On China Manufacturing – Issue 62 (October 2025)
pmiq62.jpg

PMI points to persistent yet easing downward pressure on the manufacturing sector in 3Q25 

Our observations

  • Large enterprises expand at a faster pace while small and medium enterprises continue to contract.
  • Manufacturing output growth accelerates.
  • Overall market demand begins to stabilize.
    Employment in the manufacturing sector slightly declines.
  • Manufacturers lower ex-factory prices despite rising input costs.

Policy outlook

  • A meeting of the Political Bureau of the Communist Party of China Central Committee was held on 30 July. It emphasized the need for macro policies to be continuously strengthened and intensified as necessary.
  • Given the ongoing China–US trade war, we expect that the Chinese government will ramp up policy support in 4Q25, which will help the economy navigate the challenging external environment.

Our forecasts for 3Q25

  • We project a deceleration in manufacturing production growth due to the Trump trade war and the Chinese government’s effort to address overproduction in key sectors.
  • Headline PMI will remain below 50.0.
  • VAIO growth will decelerate to 5.0% yoy.
  • Real GDP growth will slow to 4.5% yoy.
  • Exports will stay flat compared with the same period last year.
  • Year-on-year growth rates for the purchaser price index and the PPI will remain negative but slightly improve, as the Chinese government prioritizes addressing overproduction in key sectors.

PMI_Quarterly_on_China_Manufacturing_Oct25_Eng.pdf