Workers assemble engines at a factory in Weifang, Shandong province. [Photo/China Daily]

BEIJING -- China's manufacturing activity kept contracting in January, pointing to persistent weakness in the sector, data showed on Monday.

The purchasing managers' index (PMI) came in at 49.4, down from December's 49.7, according to data released by the National Bureau of Statistics (NBS) and the China Federation of Logistics and Purchasing.

A reading above 50 indicates expansion, while a reading below 50 reflects contraction.

The index also marked the lowest level since August 2012, as China's economy is at pains to seek new growth engines as the housing market slowed and industrial overcapacity overhung.

NBS statistician Zhao Qinghe attributed the retreat to slowing factory activity ahead of the Spring Festival, which falls in early February this year, as well as China's ongoing campaign to resolve excessive capacity.

The economic slowdown both at home and abroad also affected aggregate demand and foreign trade growth, Zhao explained.

In breakdown, the sub-index measuring production stood at 51.4, down 0.8 percentage point from a month earlier, and that for new orders settled at 49.5, down 0.7 point.