China's services sector recovery gathers pace in Sept - Caixin PMI
BEIJING (Reuters) - The rebound in China's service sector activity extended for a fifth straight month in September, an industry survey revealed on Friday, with recruitment increasing for the second straight year.
The purchasing managers' index (PMI) for Caixin / Markit services rose from 54.0 in August to 54.8, its highest level since June, and stayed well above the 50 mark that separates monthly growth from contraction.
The service sector, which accounts for around 60% of the economy and half of urban jobs, initially returned to growth more slowly than large manufacturers. However, in recent months, the recovery has accelerated as COVID-19 restrictions on public gatherings were lifted.
Firms hired more, albeit at a modest rate, for the second straight month, indicating some recovery in the labor market, which was hit by a sharp fall in demand and epidemic restraints earlier in the year.
Domestic demand led to new orders. The survey found that new export deals by Chinese service companies continued to decline in September.
"The post-epidemic recovery in the services sector has shown signs of accelerating," said Wang Zhe, senior economist at Caixin Insight Group, in comments posted alongside the survey.
Service companies remained bullish on the business outlook as the economy continues to recover from the COVID-19 lockdowns and the confidence sub-index rises for the year starting in August.
The official PMI also showed that activities in China's service sector expanded faster in September.
China estimated that on October 1, the start of the Golden Week vacation, there were 13 million passenger trips. According to state media, this is the highest level since the coronavirus outbreak began in February.
However, that number is still well below the 17 million trips taken on the same day last year.
Recent economic indicators, which range from trade to producer prices, point to further revitalization in the industrial sector, helping to rebound in demand after the coronavirus-induced slump.
Many analysts assume that China will be the only major economy to see positive annual growth in 2020, albeit at a low level for decades.
(Reporting by Gabriel Crossley; Editing by Sam Holmes)
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