China's Jan manufacturing PMI falls to 28-month low

He said businesses remained optimistic in spite of waning activity as entrepreneurs believe dividends from reforms will help improve the economic climate.

In terms of the surveyed enterprises, the PMI of large manufacturers posted 50.3, down from 51.4 in December but still expanding.

The PMI of medium and small enterprises, although still in a state of contraction, rose 1.2 percentage points and 0.9 percentage point respectively in January, moderate improvement from the previous month. The indices stood at 49.9 and 46.4.

The NBS also unveiled the PMI for the service sector on Sunday, which retreated to 53.7 in January from 54.1 in December, still robust amid the economic slowdown.

The BOC's research note said China's service sector should offer greater significance when projecting economic growth.

China's burgeoning service sector started to replace the traditional engine of manufacturing to drive economic growth. The added value from the tertiary sector accounted for 48.2 percent of the GDP in 2014, the NBS data showed.

Jing Ulrich, managing director and vice chairman of Asia Pacific of JP Morgan Chase, said the consumption and service sector will replace traditional engines of manufacturing and investment to drive economic growth in 2015.