The HSBC Purchasing Manager’s Index (PMI) rose to 49.1 from 48.3 in March easing concerns of a sharp slowdown in China’s economy.
There have been fears that slowing growth in key markets such as the US and eurozone may hurt China’s economy.
China relies heavily on manufacturing and exports for growth.
The PMI is a key indicator of manufacturing activity. A reading below 50 shows contraction in the sector and the HSBC index has remained below that mark for six straight months now.
However, Markit Economic Research, which publishes the index, said the latest reading “pointed to a slower pace of deterioration than in March, largely reflecting slower rates of decline of manufacturing production and new orders.”
Analysts at BNY Mellon pointed out that the index had not been consistently above 50 since June 2011, although it is above readings of the low-40s recorded during the depth of the global financial crisis in late 2008 and early 2009.
The figures come just days after China reported that its economy expanded at an annual rate of 8.1% in the first three months of the year, the slowest pace of expansion in almost three years.
Prompted by concerns over the impact of a global slowdown on its economy, China’s has been easing some of its policies in a bid to boost growth.
China’s central bank has cut the amount of money that banks need to hold in reserves, twice in the past few months, in a bid to boost lending in the country.