BEIJING--A private gauge of China's service sector activity rebounded sharply to a nearly ten-year high in May as domestic demand recovered amid government measures to buoy economic growth.
The Caixin China services purchasing managers index rose to 55.0 in May from 44.4 in April, Caixin Media Co. and research firm Markit said Wednesday. The reading stood above the 50 mark that separates expansion from contraction, after it plunged below 50 for three straight months due to the coronavirus pandemic.
The rebound was the steepest since October 2010, as service-providers said an easing of restrictions imposed to control Covid-19 had driven a renewed expansion of activity.
Total new orders saw the sharpest increase since September 2010 thanks to recovering domestic demand, Caixin said. New export orders continued to fall sharply in May.
"In general, the improvement in supply and demand was still not able to fully offset the fallout from the pandemic, and more time is needed for the economy to get back to normal," said Wang Zhe, a senior economist at Caixin Insight Group.
A subindex measuring the service sector's hiring stayed in negative territory for the fourth-straight month as companies remained cautious about expanding hiring amid the uncertain outlook.
China's official nonmanufacturing purchasing managers index rose to 53.6 in May from 53.2 in April, the National Bureau of Statistics said earlier.
The Caixin PMI is tilted more toward smaller companies while the official one is weighted more toward larger ones.
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June 03, 2020 at 10:23AM
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China Caixin service PMI up sharply in May - MarketWatch
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