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China’s services activity remained well within growth territory in April, even as a private survey showed a softer reading compared with March. The Caixin/S&P Global services purchasing managers’ index fell to 56.4 in April from 57.8 in the previous month. That’s still the second-highest figure recorded since November 2020. It also marked the fourth consecutive month above the 50-mark that separates growth and contraction. The latest Caixin reading suggests that services activity is still “undergoing a fast recovery,” according to Wang Zhe, senior economist at Caixin Insight Group. “There was still a lot of optimism in the services sector in April, with the reading for expectations for future activity remaining well above the neutral 50.0 level,” Wang wrote, adding that “businesses continued to express confidence in a better market environment as the impact from Covid waned.”
Expansion in new orders for services also softened slightly from the previous month’s reading, which was the highest in 28 months. New business from abroad also rose at a historically sharp pace, despite growth moderating from March, Caixin said. The continued expansion in China’s services activity stood in contrast to the disappointing factory activity reported earlier in the week. The Caixin China general manufacturing purchasing managers’ index fell to 49.5 in April, marking the first reading below the 50-mark in three months.
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