HSBC China PMI fell to 50.5 in December, from 50.8 the previous month. A reading below 50 indicates contraction.

But this was right in line with expectations for 50.5, which was the flash PMI print.

"The moderation of December's final HSBC China Manufacturing PMI was mainly due to slower output growth," said Hongbin Qu, HSBC chief economist China, in a press release.

"However, the final PMI sustained the fifth above-50 reading in a row thanks to a steady increase of new orders. The recovering momentum since August 2013 is continuing into 2014, in our view. With inflation still benign, we expect the current monetary and fiscal policy to remain in place to support growth."

We got China's official PMI data on Tuesday, which showed manufacturing fall to 51, from 51.4 in November.

The slowdown in credit growth is said to have weighed on Chinese manufacturing.

Here's the trajectory of Chinese manufacturing:

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