China's manufacturing sector has returned to an expansionary phase after one month, driven by strong exports fueled by the artificial intelligence (AI) boom.

The National Bureau of Statistics of China announced today (June 30) that the manufacturing Purchasing Managers' Index (PMI) for June stood at 50.3.

China's manufacturing PMI hit a yearly low of 49.0 in February, remained in expansionary territory in March (50.4) and April (50.3), but slipped to 50.0 in May.

The PMI, based on surveys of corporate purchasing managers, is an indicator of business trends in relevant sectors, with 50 serving as the threshold between expansion and contraction.

Huo Lihui, a senior statistician at the National Bureau of Statistics' Service Industry Survey Center, explained that the high-tech manufacturing PMI rose by 0.6 points from the previous month to 53.5, maintaining a strong trend.

Reuters noted that while the rise in the manufacturing PMI is attributed to the strength of the high-tech manufacturing sector due to the AI boom, domestic demand remains sluggish and exports of other product categories remain weak.

Xu Tianchen, an economist at the think tank Economist Intelligence Unit (EIU), interpreted the data as reflecting a push by companies to increase exports ahead of new tariffs expected to be imposed by the United States in late July under Section 301 of the Trade Act.

The non-manufacturing PMI for June recorded 50.2, slightly higher than the previous month (50.1).

(Photo: Captured from the National Bureau of Statistics of China website, Yonhap News)