China's factory activity shrank less sharply in May as Covid-19 curbs eased and some production resumed, improving from a 26-month low in April, a private sector survey showed on Wednesday.

The Caixin/Markit Manufacturing Purchasing Managers' Index (PMI) rose to 48.1 in May from 46.0 the previous month. May's contraction was the second-sharpest slump since February 2020, suggesting the recovery remains fragile.

The 50-point index mark separates growth from contraction on a monthly basis.

Surveyed firms tied the output drop to the impact of lingering pandemic-related restrictions on operations and subdued customer demand.

A sub-index for new orders fell for the third consecutive month in May but at a slower pace. The gauge for new export orders also shrank less but remained in contraction for a 10th straight month.

Some firms blamed the weakness in orders on the pandemic, increased difficulties in shipping items and the Russia-Ukraine war.

The private survey, focusing more on small firms and coastal regions, was in line with Tuesday's official manufacturing PMI, which rose to 49.6 from 47.4 in April.

The Caixin PMI is compiled by S&P Global from responses to questionnaires sent to purchasing managers in China. (Reuters)