China shows signs of strong recovery

China's economy is showing signs of a stronger rebound after Covid restrictions were abandoned, with manufacturing sector posting its biggest improvement in more than a decade, service sector climbing and the housing market stabilizing.

The manufacturing purchasing managers' index rose to 52.6 last month, the National Bureau of Statistics said Wednesday, the highest reading since April 2012. A non-manufacturing gauge measuring activity in both the service and construction sectors improved to 56.3. Both indexes beat economists' expectations.

"The decent PMI readings provide a positive note for the upcoming National People's Congress," with the government expected to roll out further supportive policies to cement the recovery, said Zhou Hao, chief economist at Guotai Junan International.

Other data has signaled a pickup in domestic demand. China's home sales rose in February from a year earlier, the first such increase since June 2021 as policymakers expanded support for the sector.

Top leaders in China have pledged to prioritize growth this year, placing an emphasis on the role that domestic demand will play in driving the recovery.

China's finance minister Liu Kun said that the mainland economy is expected to recover this year, leading to increased fiscal revenue.