China’s factory activity accelerated in January, a private survey showed on Monday, with manufacturers ramping up production and bringing forward shipments ahead of the extended Lunar New Year holiday.

The seasonally adjusted RatingDog China General Manufacturing PMI released by S&P Global rose to 50.3 in January from 50.1 last month, in line with the 50.3 expected by analysts in a Reuters poll. A reading above the 50 benchmark indicates expansion, while a reading below it indicates contraction.

That marked the highest level since October, when private surveys showed PMI is 50.6.

Production accelerated last month as new orders at home and abroad increased, prompting companies to hire more staff to cope with rising workloads and clear unfulfilled orders.

Total new orders rose for an eighth consecutive month, while new export orders rebounded, driven by increased demand from overseas buyers, particularly in Southeast Asia.

However, private surveys showed business confidence fell to a nine-month low as companies worried about rising costs. Business spending rose at the fastest pace in four months, pushing factory-factory prices up for the first time since November 2024.

Metals prices in particular soared during the latest survey period, sending input cost inflation to the highest level since September last year, the survey showed.

“Looking ahead, if cost pressure persists and demand recovery is limited, profit margins will continue to be under pressure,” said Yao Yu, founder of RatingDog.

Reading is better than reading official investigation Data released by the National Bureau of Statistics on Saturday showed that manufacturing activity unexpectedly contracted in January to 49.3, compared with 50.1 in the previous month.

RatingDog’s private surveys, which sample a small group of export-oriented manufacturers, generally paint a brighter picture than official polls covering a wider range of businesses.

Officials from the National Bureau of Statistics attributed the economic downturn to a seasonal slowdown and weak global demand. Local media reported that some Factory stops production Last month their workers were allowed to go home ahead of the upcoming Lunar New Year.

This year’s Lunar New Year holiday has been extended to nine days for the first time, from February 15 to February 23, as Beijing looks to increase spending on domestic travel, tourism, dining out services and leisure activities during the holiday.

These two PMI data also give people a preliminary understanding of the performance of the world’s second largest economy at the beginning of this year. China’s economy met the government’s 5% growth target last year, helped by strong exports as manufacturers stepped up shipments to non-U.S. markets amid rising U.S. tariffs.

However, economists warned that deflationary pressures would persist, with retail sales growth falling to its weakest level in three years. Fixed-asset investment also saw its first annual decline in decades last year, contracting 3.8% as the real estate market slump intensified and local government fiscal austerity curbed investment.