BEIJING (TIP): China‘s manufacturing activity expanded in March for the first time in nine months, official data showed on Friday.

The official Purchasing Managers’ Index (PMI), which tracks activity in factories and workshops, rebounded to 50.2 last month, figures from the National Bureau of Statistics (NBS) showed.

It was the highest figure in nine months and the first expansion of manufacturing activity since June 2015.

The result beat the median expectations of 49.4 in a Bloomberg News survey of economists.

A reading above 50 signals expanding activity in the vital sector, while anything below indicates contraction. Investors watch the index closely as the first available official indicator of the country’s economic health each month.

It was a rebound from February’s 49.0 figure, which was the seventh consecutive month the official index showed contraction.

NBS analyst Zhao Qinghe said in a separate statement that the March PMI showed “some positive signs have started to emerge”.

“Manufacturing production and (the) market warmed up as companies started working after the Spring Festival and the recent acceleration of supply side reform.”

A rebound in fixed-asset investment and the property market have also boosted production and consumption to some extent, Zhao said, but added the expansion was partly due to seasonal factors.

“We should be aware that there remain many difficulties in companies’ production and operation.”

Firms are still facing tight financing, insufficient demand and rising labour costs, Zhao added.

Chinese stocks were lower Friday morning despite the improvement, with the benchmark Shanghai Composite Index slipping 0.23 percent.

China’s economy, a vital driver of global expansion, grew 6.9 percent last year, its weakest rate in a quarter of a century.

Some analysts pointed to an increase in government investment as signalled at the March National People’s Congress, with SG Global Economics saying in a note before the release that infrastructure and housing investment would “lend some support” to the industrial sector.