China's factory activity rebounds sharply in March. The Manufacturing Purchasing Managers' Index climbed to 50.4, surpassing economist expectations of 50.1 and marking the strongest performance in a year. This expansion reversed two consecutive months of contraction, signaling renewed momentum in the world's second-largest economy. Production and new orders both expanded, though employment and raw material inventory remained under pressure. The rebound follows an extended national holiday in mid-February as factories resumed operations. However, geopolitical tensions in the Middle East are driving up shipping costs and commodity prices, creating headwinds for manufacturers. Export orders showed particular strength, with China's first-quarter exports surging 21.8% year-over-year. The non-manufacturing sector also improved, with services PMI rising to 50.1.
