China: Economic outlook under pressure – Commerzbank

Commerzbank's Economic Research report highlights the ongoing struggles of the Chinese economy, with both the manufacturing and services sectors slipping into contraction territory. The official purchasing managers' indices for January 2026 indicate a weak start to the year, with GDP growth expected to slow to 4.0% in 2026. The report emphasizes the need for further economic stimulus measures from the government in Beijing.

Weak economic indicators signal challenges

"The official Chinese purchasing managers' indices (PMI) for January 2026 were worse than expected, signaling a weak start to the new year. Both the manufacturing and service sectors unexpectedly slipped into contraction territory (values below 50 points)."

"We expect GDP growth to slow to 4.0% in 2026 (2025: 5.0%). The weak January figures are increasing pressure on the government in Beijing to introduce further economic stimulus measures."

"Interestingly, the private RatingDog Manufacturing PMI (which surveys more smaller, private export-oriented companies) rose slightly from 50.1 to 50.3 points. This suggests that large state-owned enterprises in particular are suffering from weak domestic demand, while the export sector is showing some resilience."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)