China service sector activity slows in June – Caixin PMI
2023.07.05 01:31
© Reuters.
Investing.com — China’s service sector grew less than expected in June, a private survey showed on Wednesday, as soft exports and weak local demand raised more questions over an economic recovery in the country.
The read 53.9 in June, weaker than expectations for a reading of 56.2 and well below May’s reading of 57.1. The data for June was also the index’s second-worst reading this year.
While both supply and demand increased through the month, they did so at a much lower pace, Caixin Insight Group said in a note.
A revival in tourism appeared to have provided only a limited boost to services demand, despite the Dragon Boat festival holiday earlier in June.
Continued stimulus measures by the Chinese government also provided limited support to local business activity, despite liquidity injections and recent interest rate cuts by the People’s Bank of China.
“The gauges for business activity and total new orders both stayed above 50 for the sixth consecutive month, but logged their lowest readings since January and December, respectively, as the services market saw a weaker-than-expected recovery,” Wang Zhe, senior economist at Caixin Insight Group said in a note.
The Caixin reading follows earlier data that showed a , while also slowed.
A separate, official survey released on Wednesday showed that overall Chinese business activity slowed substantially in June from the prior month, with the falling to 52.5 in June from 55.6 in May.
A swathe of weak economic data from China has raised questions over whether Asia’s largest economy will rebound as strongly as markets are expecting. Chinese manufacturing activity contracted for all three months in the second quarter, brewing concerns over a weak gross domestic product reading for the period.
Stimulus measures from the Chinese government have so far had a limited impact on business activity, with private investors remaining wary of the country. Recent losses in Chinese stocks and the have also reflected worsening sentiment towards the country.
