The purchasing managers index (PMI), a barometer of manufacturing activities, reached 52.2 percent in February 2011, down 0.7 percentage points from January, said the China Federation of Logistics and Purchasing (CFLP).

This was the lowest reading in six months, and the third consecutive monthly decrease. But it still marked the 24th straight month in which the index was above the boom-and-bust line of 50 percent.

The PMI includes a package of indices to measure manufacturing sector performance. A reading above 50 percent indicates economic expansion.

We expect the PMI to head south in the months ahead; that may reduce the possibility of more stringent measures from the Central Government, said Tang Yonggang, an analyst from Hongyuan Securities Co. Ltd.

Still, Bank of America-Merrill Lynch economist Lu Ting said that China's January and February readings for the PMI "could be quite misleading" due to distortions from the Lunar New Year holiday (February 2-8).

"The short history of this index and the volatile timing of the Chinese New Year holiday mean that no seasonal adjustment method can give us a credible result," he said.