Sept.4--CHINA's manufacturing purchasing managers index stood at 51.3 in August versus 51.2 in July, exceeding the forecast of 51 in a Bloomberg survey of economists.

The non-manufacturing PMI, covering services and construction, also rose to 54.2, the statistics bureau said, compared with 54 in July. Levels above 50 indicate improvement.

"The nation's pro-growth measures have taken effect to stabilise sentiment," said Ding Shuang, chief economist for Greater China and North Asia at Standard Chartered, who accurately forecast the monthly PMI reading.

Mr Ding cited more proactive fiscal policy, tax cuts, expedited bond sales and better credit access for smaller companies as part of the reason for the upturn.

"Steady production and new domestic orders outweighed weaker new export orders," said Morgan Stanley economist Jenny Zheng.

New export orders dropped to 49.4, the lowest level since February, when the Chinese New Year disrupted production.

But Ms Zheng also said: "The economy could remain on a path of soft landing, as defensive easing measures could boost infrastructure investment and cushion potential impact from trade tensions."

Said Andrew Polk, co-founder of research firm Trivium China in Beijing: "Infrastructure investment is just so low it's going to be a real challenge for them to get that unstuck.