China’s services sector grow at fastest in 15 months: Caixin

SHANGHAI, May 6 (SMM) – Activity in China’s services sector in April expanded at the fastest pace in 15 months, with new export orders growing at a record rate, a Caixin survey showed on Monday May 6.

The Caixin services purchasing managers’ index (PMI) inched up 0.1 from March to stand at 54.5 in April. The reading marked the highest since January 2018 and the second highest since May 2012. The 50-mark separates growth from contraction.

Services, including finance, real estate services, marketing, transport and retailing, accounted for more than 57% of China’s gross domestic product and more than 60% of economic growth in the first three months of 2019.

New export orders increased by the most since the survey began measuring this in September 2014, bolstered by stronger demand across key overseas markets, the survey said.

Total new orders maintained solid growth, but slowed marginally from the 14-month high in March. 

Dragged by weaker growth in manufacturing, Caixin’s composite PMI, which covers both manufacturers and services providers, slipped to 52.7 in April from 52.9 a month earlier.

"In general, China’s economy looked resilient in April, especially in the services sector," said Zhong Zhengsheng, director of macroeconomic analysis at CEBM Group, an affiliate of Caixin Global.

"However, pressure on costs across the services sector remained relatively high, limiting companies’ profit growth potential. Business confidence hasn’t recovered," Zhong added.