HSBC said on 9 February its Purchasing Managers’ Index (PMI) for the services sector in China dropped to a 25-month low in January as new business slowed.
Manufacturing output rose robustly in January. However, this was offset by only a modest expansion in the service sector, where activity growth eased to the third-lowest in the five-year survey history. The PMI fell from 53.1 in December to 52.0, according to HSBC’s report.
Commenting on the China Services and Composite PMI data, Qu Hongbin, chief economist of China & Co-Head of Asian Economic Research at HSBC said: "It is surprising to see the Services PMI continuing to soften to a level close to that seen during the financial crisis. Property tightening along with overall monetary tightening is likely to be the major drag on sentiment and business activities. That said, no worries about growth, because of the strength in consumer spending and massive ongoing investment projects. In fact, it is helpful to contain inflation in services."
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