China’s service sector contracted at faster pace in October amid Covid outbreaks – private survey
DATA MACRO
China’s service sector contracted at faster pace in October amid Covid outbreaks – private survey
DATA MACRO

China’s service sector contracted at faster pace in October amid Covid outbreaks – private survey

 

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China’s service sector contracted at a faster pace in October as COVID-19 containment measures hit businesses and consumption.

The Caixin services purchasing managers’ index (PMI) fell to 48.4 last month, the lowest since May, from 49.3 in September as rising COVID caseloads led to worsened disruptions and weighed on consumer confidence. The 50-mark separates contraction from expansion on a monthly basis.

Survey respondents said new business was down for second consecutive month in October despite the week-long National Day holiday earlier in the month. The gauge for new export orders also dropped into contraction territory from expansion the previous month.

However, employment stepped up ,with the sub-index hitting the highest since May 2021 and ended a run of job losses stretching back to the start of 2022. Surveyed firms also maintained a positive outlook for business activity over the next 12 months, shaking off a six-month low in September.

“The negative impact of COVID controls on the economy lingered, and the economy was faced with increasing downward pressure,” said Wang Zhe, an economist at Caixin Insight Group.