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Caixin services PMI in November records the second highest since May 2010

作者:admin 2020-12-04

Caixin services PMI in November records the second highest since May 2010

Tourists enjoy dinner at a night market in Shouchang Township of Jiande City, east China's Zhejiang Province, November 10, 2020. Shouchang, a small town in mountainous area of Zhejiang, has set up a special night market bringing together night-time booths and more than 30 restaurants, in an effort to enrich people's leisure time and boost local economy. The night market has received over 720,000 tourist trips and raked in 76.33 million yuan (about $11.57 million) since it opened during the Labor Day holiday. (Xinhua/Weng Xinyang)

Caixin services PMI stood at 57.8 in November, beating the market expectation of 56.4, up 1 percentage point from October. The latest gauge of China's service sector activity reached its second highest reading since May 2010, reflecting faster recovering of the country's services sector following the impact of COVID-19.

The Caixin manufacturing PMI in November, 54.9, also recorded a 10-year high. Rising PMI in manufacturing and services indicated that domestic economic activity was robust in the previous months and the recovery in domestic demand accelerated. Analysts said that China's service sector will continue to boom. 

This trend is supported by both the PMI and new orders index, having expanded for the seventh straight month in November, according to statistics released on Thursday.

The recovery of external demand is also strong. The index of new export orders for the services sector rose sharply above the expansion-contraction line in November, the first increase since June and the fastest pace since April 2019. Surveyed companies generally reported an increase in the number of domestic and overseas customers against the backdrop of a continued recovery in overall market conditions. This shows that despite the uncertainty of the epidemic abroad, export demand has improved significantly, according to Caixin.

Analysts have attributed the recovery of the consumer market and the steady rebound of the service sector to China's targeted and effective measures against COVID-19.

"China's prevention and control on COVID-19 is improving, consumers are more willing to rejoin the economy. The country has introduced rescue measures targeting the service sector, while the epidemic has given rise to new consumption patterns and demand. Domestic tourism, catering, accommodation, transportation and logistics, entertainment and other industries that were hampered by the epidemic have seen recovery accelerate significantly in recent months," Zhou Maohua, an analyst at the Everbright Bank, told the Global Times on Thursday.

The strong expansion of the service sector is conducive to easing the pressure on the domestic employment market with supply and demand well balanced, Zhou added.

The service sector's employment index expanded for four months in a row, reaching its highest reading since November 2010. Entrepreneurs were extremely optimistic about the economic outlook, with an index of business expectations for the service sector rising in November to its highest level since May 2011, above its long-term average, per statistics.

The services PMI moves in line with that of National Bureau of Statistics, which rose 0.2 percent points to 55.7 in November.

"China has entered its traditional consumption season. After the release of suppressed domestic demand for services, China's service sector will continue to perform above expectations. Based on these trends, the manufacturing and service sectors are still expected to continue to lead the recovery," Zhou said.

  • China's manufacturing activities expand at fastest rate in a decade: Caixin PMI
  • China's non-manufacturing PMI rises in November
  • China's Caixin manufacturing PMI stands at 53.6 in October, highest since February 2011

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