China Caixin Services PMI Falls to 17-Month Low

Activity in China’s services sector — the biggest contributor to gross domestic product — expanded at its slowest pace in 17 months in December, according to a closely-watched private survey, an indication of headwinds faced by China in its shift toward a more service-oriented economy.

The Caixin/Markit Purchasing Managers’ Index (PMI) for December fell to 50.2, from November’s 51.2. In October, the index hit a three-month high of 52. December’s services PMI reading was the lowest since July 2014.

A number above 50 indicates activity is expanding, while one below that level indicates a contraction.

Wednesday’s report was also far weaker than the government’s reading of services sector activity, and comes on the heels of more downbeat factory data.

Official services PMI for December, released on Thursday, rose to 54.4, from November’s 53.6, while the final Caixin/Markit manufacturing PMI contracted for the tenth straight month in December.


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Craig Erlam

Craig Erlam

Former Senior Market Analyst, UK & EMEA at OANDA
Based in London, Craig Erlam joined OANDA in 2015 as a market analyst. With many years of experience as a financial market analyst and trader, he focuses on both fundamental and technical analysis while producing macroeconomic commentary. His views have been published in the Financial Times, Reuters, The Telegraph and the International Business Times, and he also appears as a regular guest commentator on the BBC, Bloomberg TV, FOX Business and SKY News. Craig holds a full membership to the Society of Technical Analysts and is recognised as a Certified Financial Technician by the International Federation of Technical Analysts.