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China services PMI drops to 54.2% in July
August 3, 2014, 4:44 am

July's reading marked the lowest level in six months [Xinhua]

July’s reading marked the lowest level in six months [Xinhua]

Even as Chinese policymakers are selectively easing monetary policies to support faltering growth, an official monthly survey on Sunday revealed a slight slowdown in China’s services sector.

The Purchasing Managers Index (PMI) of the non-manufacturing sector came in at 54.2 per cent in July, down 0.8 percentage points from June, said China’s National Bureau of Statistics and the China Federation of Logistics and Purchasing (CFLP).

July’s reading marked the lowest level in six months.

The non-manufacturing PMI tracks activity in sectors including construction, software, aviation, railway transport and real estate.

A reading above 50 in PMI surveys indicates an expansion in activity while one below the threshold points to a contraction.

Compared with a month earlier, the sub-index for new orders remained flat at 50.7 per cent, while that for new export orders saw a slight drop of 0.4 percentage points to 49.8 per cent.

The sub-index for employment retreated 1.1 percentage points to 49.3 percent in July, and that for business outlook recovered 1.1 percentage points to reach 61.5 percent.

Notably, the property market remained weak, with the business activity, new orders and price indices for the sector, all dipping below the 50-percent demarcation.

Earlier official data showed China’s home prices continued a downward trend in more cities in June, with the average price in these 70 cities slipped 0.47 per cent from the previous month, marking a second consecutive monthly drop following a 0.15-per cent fall in May.

Sunday’s data came on the heels of the manufacturing data that showed activity quickened to the highest level in more than two years in July, reinforcing signs that the economy is firming up on government support policies.

 

Source: Agencies

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