China’s Services Sector Shows Growth in March
The services purchasing managers’ index (PMI) in China increased to 52.7 in March, up from 52.5 in February, indicating continued expansion for the 15th consecutive month.
Key Points:
- New business expanded at the fastest rate in three months.
- The uptick in growth suggests a potential recovery in sentiment within the Chinese economy.
- Initiatives to stimulate new orders contributed to the acceleration in new business expansion.
- Business confidence strengthened with a rise in the sub-index of future activity.
- Optimism surrounds the impact of new product lines, expansion strategies, and increased client budgets on sales.
- Despite positive sales and business confidence, employment levels in the services sector contracted for the second consecutive month.
- Resignations and redundancies aimed at enhancing productivity were cited as reasons for the decline in payroll numbers.
Composite PMI and Overall Improvement
The composite PMI rose to 52.7 in March, up from 52.5 in February, marking the highest reading since May 2023. This suggests an overall improvement in both manufacturing and services activities.
Expert Insights
Wang Zhe, an economist at Caixin Insight Group, highlighted the slight acceleration in growth in both manufacturing and services sectors. He also noted improved exports and sustained market optimism as positive factors. However, Zhe pointed out that employment levels continued to contract, while input and output prices remained low, indicating sluggish demand.
