China October Services Activity Rises to 3-Month High

Activity in China’s services sector expanded at its fastest pace in three months in October, a private survey showed on Wednesday, easing concerns over persistent weakness in the world’s second-largest economy as the manufacturing sector falters.

The Caixin/Markit Purchasing Managers’ Index (PMI) rose to 52.0 in October from September’s 14-month low of 50.5, hitting the highest level since July 2015. A reading above 50 points signifies growth on a monthly basis, while one below that points to a contraction.

“This shows that previous stimulus policies have begun to take effect, while the economic structure steadily improved,” said He Fan, chief economist at Caixin Insight Group. “The economy has started to show signs of stabilizing, reducing the need for a further stimulus.”

A sub-index measuring new business jumped to 52.9 from September’s 50.5 while the employment sub-index also improved to a three month high.

Still, underscoring an uncertain economic outlook, business expectations moderated to a record low in October.


Craig Erlam
Based in London, England, Craig Erlam joined OANDA in 2015 as a Market Analyst. With more than five years' experience as a financial market analyst and trader, he focuses on both fundamental and technical analysis while conducting macroeconomic commentary. He has been published by The Financial Times, Reuters, the BBC and The Telegraph, and he also appears regularly as a guest commentator on Bloomberg TV, CNBC, FOX Business and BNN. Craig holds a full membership to the Society of Technical Analysts and he is recognized as a Certified Financial Technician by the International Federation of Technical Analysts.