China's manufacturing may grow at a faster pace in March as production is set to expand strongly to ride on an increase in new export orders, a survey showed yesterday.

The HSBC Flash China Manufacturing Purchasing Managers' Index, an indicator to measure industrial activities across the country, stood at 52.5 this month, above the final HSBC PMI of 51.7 in February. The Flash China Manufacturing Output Index ended at 55.1, above 51.9 in February.

"The growth of the manufacturing sector bounced a little this month after slowing in February. This should ease concerns about a sharp slowdown in growth," said Qu Hongbin, co-head of Asian Economic Research at HSBC.

"Meanwhile, the increase in both input and output prices sub indices started to slow, implying that Beijing's tightening measures are working to contain inflationary pressures without choking off growth. We expect Beijing to continue the tightening measures in the coming months. Combined with supply-side cooling measures, this should slow inflation meaningfully by the middle of the year," Qu said.

In February the bank started to publish the flash China PMI data on a monthly basis about one week before the final PMI. It is based on more than 85 percent of total PMI survey responses and provides an indication of the final PMI data.

The official PMI shed 0.7 percentage point from January to 52.2 percent in February, according to the China Federation of Logistics and Purchasing.

The People's Bank of China has ordered banks to set aside more capital from lending for the third time this year from today.