China’s service sector continues to contract

It was reported that the economic activity of the service sector in China continued its contraction in the last 4 months of 2022.

Economic and financial news service Caixin’s China General Services Business Efficiency Index rose 1.3 points month-on-month to 48 in December, but remained below the growth threshold of 50.

The indicator, which fell below 50 in March, April and May, began to contract again from September, after exceeding 50 in July and August.

In the index, where the fixed average is 50 points, values ​​above 50 indicate an increase in economic activities, while values ​​below indicate a decrease.

THE MANUFACTURING INDUSTRY HAS A TENDENCY OF CONTRACTION FOR 5 MONTHS

The index, drawn from the results of surveys sent to purchasing managers of more than 400 companies operating in the service sector in China, is seen as a barometer of economic activity in the service sector.

China’s manufacturing purchasing managers’ index (PMI), which measures economic activity in the manufacturing sector, announced yesterday by Caixin, fell 0.4 points to 49 in December compared with the previous month.

The index pointed out that the manufacturing industry was in a contraction trend in the last 5 months of 2022.

QUARANTINE MEASURES HAVE NEGATIVELY AFFECTED

Analysts predict that a recovery in the sector can be expected in the new year after the covid-19 outbreaks and quarantine measures in the fall continue to have a negative impact on services, and after the policy change to relax measurements at the end of the year. year.

While leading indicators show the economic recovery is faltering, it is unclear whether the government will hit its growth target of around 5.5 percent this year. The growth rate held at 3 percent in the first three quarters. (AA)