China's Services Activity Grows At Slower Pace In October

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The growth in China's services sector activity slowed in October, a survey by Markit Economics and HSBC said Wednesday. The seasonally adjusted HSBC Business Activity Index fell to a four-month low of 56.5 in October.

A reading above 50 indicates expansion, while a reading below 50 signals contraction.

The composite output index, measuring private sector activity and includes both services and manufacturing activity, stood at 56.9, declining for the second consecutive month, mainly due to the slower growth in services.

Output and new business in the private sector grew at a slower pace in October. However, staffing levels rose at the fastest pace in 26 months. Meanwhile,overall input and output prices increased at a slower pace.

Commenting on the China Services and Composite PMI data, Hongbin Qu, Chief Economist for China at HSBC said, "Thanks to the continuous increase in new business, the HSBC China Services PMI showed a solid expansion in services business activity in October, though at a slower pace compared with the previous three months."

"This has enabled enterprises to hire additional workers, even at a lower cost, as indicated by robust employment growth and the Input Prices Index, which was marginally below 50.0 in October", Qu said

"Going forward, the likely strong recovery in domestic demand will help strengthen business expectations and also boost demand for services products", the economist added.

(Market News Provided by RTTNews)