BEIJING, Jan 31 Reuters China39;s manufacturing activity contracted for the fourth straight month in January, an official factory survey showed on Wednesday, suggesting the sprawling sector and the broader economy were struggling to regain momentum at the start of 2024.

The official purchasing managers39; index PMI rose to 49.2 in January from 49.0 in December, driven by a rise in output but still below the 50mark separating growth from contraction. It was in line with a median forecast of 49.2 in a Reuters poll.

The data provides the first official snapshot of how the world39;s No.2 economy has started off the new year after a shakierthanexpected postCOVID recovery.

The latest figure is also affected by the Lunar New Year which will fall on Feb. 10 this year, as factories may shut earlier and send workers back home ahead of the holiday.

Economic momentum remained muted as the deflationary pressure persists, said Zhiwei Zhang, chief economist at Pinpoint Asset Management, and expects China39;s central bank to cut rates in the first half of the year to boost domestic demand.

January39;s new orders subindex was at 49.0, contracting for the fourth month, according to the NBS survey. Weak external demand also dragged on manufacturing activity, with the new export orders index registering at 47.2, contracting for the 10th straight month.

To spur growth, China39;s central bank governor Pan Gongsheng unexpectedly announced a cut to banks39; reserve requirement ratio at a…