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China's economic recovery
EconomyEconomic Indicators

China’s services activity softens in June as recovery falters, expands at slowest pace in 5 months

  • Caixin/S&P Global services purchasing managers’ index (PMI) fell to 53.9 in June from 57.1 in May
  • Last week, the official non-manufacturing gauge, which measures business sentiment in the services and construction sectors, fell to 53.2 in June from 54.5

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China’s Caixin/S&P Global services purchasing managers’ index (PMI) fell to 53.9 in June from 57.1 in May, data released on Wedneaday showed. Photo: Bloomberg
Reuters

China’s services activity expanded at the slowest pace in five months in June, a private-sector survey showed on Wednesday, as weakening demand weighed on post-pandemic recovery momentum.

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The Caixin/S&P Global services purchasing managers’ index (PMI) eased to 53.9 in June from 57.1 in May, the lowest reading since January when the coronavirus swept through the country after authorities ditched antivirus curbs. The 50-point mark separates expansion from contraction in activity.
The data broadly tracked the government’s official PMI released last week and showed a slowdown in service sector activity as demand for in-person services weakened.

After growing at a faster-than-expected pace in the first quarter, the world’s second-biggest economy lost steam in April-June amid steepening deflation, high youth unemployment and sluggish foreign demand.

Business activity and new orders both expanded at notably slower rates last month than in May, the Caixin PMI showed. New export business growth also slowed, but maintained a brisk pace.

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Services companies signalled a solid rise in input costs at the end of the second quarter, with the rate of inflation little changed from May, while prices charged by service providers rose marginally in June.

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