China's services PMI expands

Growth in China's services activity accelerated in July helped by new orders, although momentum in overseas demand eased to its slowest pace in 11 months, a private-sector survey showed yesterday.

The Caixin/S&P Global services purchasing managers' index rose to 52.1 from 51.2 in June, pointing to expansion for the 19th straight month. The index covers mostly private and export-oriented companies and the 50-mark separates expansion from contraction on a monthly basis.

In contrast, the official services PMI showed the sector stalling in July from growth in June, with retail sales, capital market services and real estate service industries all shrinking.

The world's second-biggest economy grew much more slowly than expected in the second quarter and faces deflationary pressures and a protracted property slump, with retail sales growth in June grinding to its weakest pace since early 2023.

The Caixin/S&P survey showed that the new orders sub-index rose to 53.3 in July from 52.1 in June, while the gauge of overseas demand showed the smallest expansion since August 2023.

Hong Kong's PMI also rose to 49.5 from 48.2 last month.

Service providers grappled with growing costs for raw materials, wages and freight, but employment rose at the fastest pace in 11 months.

The Caixin/S&P's composite PMI, which tracks both the services and manufacturing sectors, eased from June but remained in expansionary territory.

Reuters