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China's services growth hits 14-month high in July on export demand: PMI
The S&P Global China General Services PMI rose to 52.6 in July from 50.6 the previous month, marking the fastest pace since May last year. The 50-mark separates expansion from contraction.
The reading contrasted with China's official survey, which showed services activity edging down slightly to 50.0 in July from 50.1 in June.
The S&P PMI is considered a better read of trends among smaller, export-oriented firms, particularly along the east coast, while the official PMI primarily tracks large and medium-sized enterprises, including state-owned companies.
China's economy, the world's second largest, slowed less than expected in the second quarter helped by policy measures and factories leveraging the US-China trade truce to front-load shipments. However, concerns remain about the second half of the year as export momentum weakens, prices decline and consumer confidence remains subdued, partly hurt by a prolonged property market downturn.
According to the S&P Global survey, the fastest growth in new business in a year supported the rise in activity heading into the second half of the year. The new export orders sub-index rose for the first time in three months, bolstered by stronger tourism activity and more stable trade conditions.
The survey showed that after reducing staffing levels in June, service providers increased employment at the quickest rate since July 2024, driven by higher workloads and improved confidence. This led to a slower accumulation of backlogged work.
Rising costs for raw materials, fuel and salaries kept average input prices in expansion territory in July. As a result, service providers raised their selling prices for the first time in six months.
With new business and activity on the rise, overall business confidence improved.
From July, Caixin no longer sponsors the S&P Global China PMI.
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