China's purchasing managers index (PMI) for the manufacturing sector has dropped to 50.2% in February from 50.5% in January.
The decline from January continued with most of the sub-indices shrinking, according to a statement jointly released by the National Bureau of Statistics (NBS) and the China Federation of Logistics and Purchasing (CFLP).
The index shows that the manufacturing sector was expanding but the growth rate was slowing down, said Zhao Qinghe, a senior analyst with the NBS.
A reading below 50 indicates contraction while that above 50 signals expansion.
Zhao attributed the decline in PMI to the Spring Festival holiday when most enterprises suspended production and workers went back home.
In February, the sub-index for production stood at 52.6%, down 0.4 percentage points from January, while the sub-index for new orders lost 0.4 percentage points to 50.5%, the statement added.
The two sub-indexes on foreign trade of the sector also declined.
The sub-index for new export orders edged down to 48.2% and import sub-index dropped to 46.5%, state run Xinhua news agency reported.
Despite overall retreats, the sub-index for production and business expectation climbed to 61.8%, indicating strengthening enterprises' confidence for future economic growth.