China’s official reading of manufacturing activity might have dipped to an eight-month low in July but economists say the figure masks an economy that has already bottomed and on track for a rebound in the second half.

China's Purchasing Managers' Index fell to 50.1 in July from 50.2 in June, a survey by the National Bureau of Statistics showed on Wednesday. Although this is lower than the 50.3 expected by economists polled by Reuters, some observers tell CNBC that after adjusting for seasonality, the reading shows that the manufacturing sector is actually improving, thanks to the slew of stimulus measures implemented by the Chinese government.

Helen Qiao, Chief Economist for Greater China with Morgan Stanley, said the July reading usually declines by about 0.8 percentage points from June on average every year.

“If it does come out around this level, we would say that after seasonal adjustment, actually this number implies a pretty notable rebound in terms of growth momentum,” Qiao told CNBC Asia’s “Squawk Box” on Wednesday before the release of the number.

The July reading in 2011 slipped to 50.7 from 50.9 in June. In 2010, the reading plunged to 51.2 from 52.1. In 2009, the PMI inched up to 53.3 from 53.2 because it was coming out of the 2008 recession.

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