Chinese manufacturing activity grew more than expected to a four-month high in March due to a sustained rise in new orders, private Purchasing Managers Index (PMI) data showed on Tuesday. 

The Caixin manufacturing PMI grew 51.2 in March, above expectations of 50.6 and the prior month’s reading of 50.8.

A reading above 50 signals expansion, and March’s increase—its largest since November—marks the sixth consecutive month of growth.

The Caixin data comes days after the government PMI, which showed the manufacturing sector grew more than expected in March.

Stronger demand and new product launches helped boost new business inflows. Foreign demand also picked up, with companies reporting the fastest increase in export orders in nearly a year, the PMI survey stated.

"The majority of surveyed companies expressed confidence in the near-term economic outlook, although some remained cautious over a potential escalation in global trade tensions," Wang Zhe, senior economist at Caixin Insight said in a statement.

Beijing rolled out major stimulus measures in 2024, but China’s economy faces additional pressures from U.S. trade policies under President Donald Trump.

Trump has already imposed 20% additional tariffs on Chinese goods in his second term, with more broad tariffs potentially on the horizon.

"The government has made boosting consumption the top priority of its economic work this year. That means policy efforts should focus on stabilizing employment, alleviating households’ financial burdens, and increasing their disposable income," Wang Zhe added.

Last month, China launched a special action plan to stimulate domestic consumption as part of efforts to drive economic growth.