China’s services sector remained strong in October, second highest in 10 years

Caixin/Markit services purchasing managers’ index (PMI), a gauge of sentiment among smaller, private firms, rose to 56.8 in October from 54.8 in September

It follows the official non-manufacturing PMI rising to 56.2 in October, above the 55.9 reading for September

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The Caixin/Markit services purchasing managers’ index (PMI) rose to 56.8 in October from 54.8 in September. Photo: Xinhua

Published: 9:50am, 4 Nov 2020Updated: 11:41am, 1 Dec 2020

Activity in China’s services sector accelerated in October as the economy continued its strong recovery from the coronavirus outbreak earlier this year, a private survey showed on Wednesday.

The Caixin/Markit services purchasing managers’ index (PMI), a gauge of sentiment among smaller, private firms, rose to 56.8 in October from 54.8 in September. A reading above 50.0 indicates growth, while a reading below represents a contraction.

October’s reading was higher than the median prediction of 55.0 expected by analysts in a survey by Bloomberg and was the second highest in 10 years, behind only the 58.4 recording in June.

The Caixin/Markit composite PMI, which combines sentiment readings for the manufacturing and services sector, rose to 55.7 from 54.5 in September.

On Saturday, the official non-manufacturing PMI, which measures sentiment in the services and construction sectors but focus on larger, state owned firms, stood at 56.2 in October, above the 55.9 reading for September.

China’s services industry had initially lagged other sectors of the economy in the country’s post-pandemic recovery as coronavirus lockdown measures prevented consumers from shopping, dining out and taking holidays.

China’s overall economy has continued its recovery from the impact of the coronavirus, with growth in the third quarter accelerating to 4.9 per cent from 3.2 per cent in the second and a contraction 6.8 per cent in the first.