Factory activity in China unexpectedly expanded in March after contracting sharply to a record low, but the rapid global spread of the coronavirus is expected to keep businesses and the overall economy under heavy pressure as foreign demand slumps.

FILE PHOTO:A worker walks past a steel factory in Beijing April 1, 2013. REUTERS/Kim Kyung-Hoon

BEIJING: Factory activity in China unexpectedly expanded in March after contracting sharply to a record low, but the rapid global spread of the coronavirus is expected to keep businesses and the overall economy under heavy pressure as foreign demand slumps.

The Purchasing Managers’ Index (PMI) rose to 52 in March from the collapse to a record low of 35.7 in February, China’s National Bureau of Statistics said on Tuesday, and above the neutral 50-point mark that separates growth from contraction on a monthly basis.

Analysts polled by Reuters had expected the March headline reading to come in at 45.0.

Analysts are forecasting China to suffer a steep economic contraction in the first quarter due to widespread disruptions to business and consumer activity caused by the virus as authorities put in place tough public measures to contain the pandemic.

(Reporting by Lusha Zhang and Ryan Woo; Editing by Shri Navaratnam)

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