China’s services sector activity growth expands at slowest rate in 5 months due to coronavirus outbreaks
- Caixin/Markit services purchasing managers’ index (PMI) fell to 51.4 in January from 53.1 in December
- China’s official non-manufacturing PMI, which measures business sentiment in the services and construction sectors, earlier fell to 51.1 from 52.7 in December
Activity in China’s services sector in January expanded at the slowest pace in five months, as a surge in local coronavirus cases and containment measures hit new business and consumer sentiment while employment fell, a private survey showed on Monday.
The soft reading is likely to reinforce market expectations that policymakers need to roll out more support measures to stabilise the faltering economy.
A subindex for new business in the survey stood at 51.1 in January, slower than the long-run series average and below 52.5 in the previous month.
The resurgence of Covid-19 in several regions such as Xian and Beijing forced local governments to tighten epidemic control measures, which restricted production, transportation and sales of goods
Some services providers attributed slower growth to the virus outbreaks. In addition, rising cases abroad weighed on foreign demand, driving new export orders into contractionary territory for the first time in four months.