China’s manufacturing sector continued to expand in May, with a closely watched private survey showing activity growing for a sixth straight month and outperforming market expectations, even as official data pointed to more modest momentum.

The RatingDog China General Manufacturing Purchasing Managers’ Index, compiled by S&P Global, came in at 51.8 in May, above the 50‑point threshold that separates expansion from contraction. 

While slightly down from April’s 52.2, the reading beat economists’ forecasts of around 51.6 in a Reuters poll and remained above the survey’s long‑run average.

Production increased for the sixth month in a row, led by investment‑goods manufacturers, with firms citing stronger market demand, higher new orders, product upgrades and new business as drivers. Overall new orders rose for a 12th consecutive month, signalling continued underlying demand, though the pace of growth eased compared with April.

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By contrast, the official manufacturing PMI, which tends to focus more on larger state‑owned and heavy‑industry firms, edged down to 50.0 in May from 50.3 in April, indicating flat activity on the month. Analysts noted that the five‑day Labour Day holiday and external uncertainties, including higher global energy prices and geopolitical tensions, likely weighed on some segments.

The divergence between the two gauges reflects their different coverage: the private survey captures conditions at many smaller, export‑oriented manufacturers, while the official index tracks bigger enterprises and a broader industrial base.

One supportive sign for factories was an easing of cost pressures. Both input and output price inflation moderated in May, providing some relief on margins after several months of stronger cost increases. Backlogs of work rose for a fourth straight month, as steady orders and some supply delays added to workloads, even though employment dipped slightly and export orders fell for the first time in five months.

Manufacturers on balance remained optimistic about output over the next 12 months, with confidence broadly in line with the average seen so far in 2026, according to the private survey.