BEIJING, Jan 4 (Reuters) – China’s services activity expanded at the fastest pace in five months thanks to a solid rise in new business, a private-sector survey showed on Thursday, lifting the degree of optimism in the sector to a three-month high.<\/p>\n
The data, offering a snapshot of business sentiment, was in contrast to an official survey on Sunday which showed a sub-index of services activity shrank again at the end of 2023, raising calls for more stimulus measures in the new year.<\/p>\n
The Caixin\/S&P Global services purchasing managers’ index (PMI) rose to 52.9 in December from November’s 51.5, above the 50-mark separating growth from contraction and posting the highest reading since July.<\/p>\n
Aided by robust new business which expanded at the fastest rate since May, firms attributed the improvement to rising customer numbers and spending.<\/p>\n
“The overall number of customers rose slightly in December compared with November,” said a restaurant owner surnamed Jin, based in Hangzhou, a city in eastern Zhejiang province.<\/p>\n
“But still, businesses in 2023 were worse than 2022 due to the macro economic trend,” Jin said.<\/p>\n
Foreign demand for Chinese services also increased last month. Around 214,000 travellers from France, Germany, Italy, the Netherlands, Spain, and Malaysia entered China in December after the visa-free policy took effect, up 28.5% from November, according to the National Immigration Administration.<\/p>\n
Improved demand conditions led firms to increase their staffing levels as they planned to meet rising business requirements. A sub-index of employment returned to expansion in December following November’s contraction.<\/p>\n
Services firms remained upbeat about their business activity in 2024, with the level of positive sentiment increasing to a three-month high, though it was still below the series average.<\/p>\n
Taken together with the better-than-expected Caixin manufacturing PMI, the Caixin\/S&P’s composite PMI rose to 52.6 last month from November’s 51.6, the highest reading since May.<\/p>\n
The vibrancy in the services sector extended to the new year as travel data suggest an improvement in the number of domestic visitors during the three-day New Year’s holiday from Saturday to Monday.<\/p>\n
However, the downbeat PMI survey by the National Bureau of Statistics (NBS) suggests the world’s second-largest economy is still under pressure as the once-mighty property sector fails to show any meaningful rebound, consumers are tightening their belts and factories have been cutting selling prices.<\/p>\n
Analysts interpret the divergence between Caixin PMI and the official PMI as differences in their geographic and sector coverage.<\/p>\n
To spur growth, China’s central bank made 350 billion yuan ($49.01 billion) in loans to policy banks through its pledged supplementary lending (PSL) facility in December, increasing market bets that China would cut interest rates further.<\/p>\n
The NBS will release economic indicators including industrial output and retail sales in coming weeks.<\/p>\n
($1 = 7.1417 Chinese yuan renminbi) (Reporting by Ellen Zhang and Ryan Woo Editing by Shri Navaratnam)<\/p>\n","protected":false},"excerpt":{"rendered":"
BEIJING, Jan 4 (Reuters) – China’s services activity expanded at the fastest pace in five months thanks to a solid rise in new business, a private-sector survey showed on Thursday, lifting the degree of optimism in the sector to a three-month high. The data, offering…<\/p>\n","protected":false},"featured_media":32282,"menu_order":0,"template":"","acf":[],"yoast_head":"\n