China Private Sector Expands At Fastest Pace Since Mid-2022
China’s private sector expanded at the fastest pace in nine months in March on an accelerated rise in services activity, survey data from S&P Global showed on Thursday.
The Caixin composite output index rose to 54.5 in March from 54.2 in February.
The score remained above the neutral 50.0 for the third consecutive month. Moreover, the pace of growth was the steepest since June 2022.
Data showed that a strong rise in services activity was offset by a softer upturn in manufacturing output.
The services Purchasing Managers’ Index rose to 57.8 in March from 55.0 in February. The score signaled the fastest rate of expansion since November 2020.
In March, the manufacturing and services sectors diverged with services activity picking up at a faster pace, while manufacturing activity dragged, reflecting that the foundation for economic recovery is not yet solid, Caixin Insight Group Senior Economist Wang Zhe said.
“Looking forward, economic growth will still rely on a boost in domestic demand, especially an improvement in household consumption,” Wang said.
Beijing aims to achieve economic growth of around 5.0 percent in 2023. The second largest economy in the world grew only 3.0 percent in 2022, marking the weakest expansion in decades.
At the composite level, total new business grew at a stronger pace, which was only fractionally slower than February’s 21-month record. Growth in new orders in services gathered pace, while manufacturers posted a weaker upturn in sales.
New export work dropped slightly driven by a fresh decline foreign demand for manufactured goods.
Further, the PMI survey showed that employment grew moderately for the second straight month. Inflationary pressures were broadly stable and were mild.
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