CN: General Services PMI

Thu May 03 20:45:00 CDT 2018

Actual Previous
Composite - Level 52.3 51.8
Services - Level 52.9 52.3

The Caixin China General Services Business Activity Index advanced from 52.3 in March to 52.9 in April, with the manufacturing PMI headline index, published earlier in the week, showing a slight increase in its headline index from 51.0 to 51.1. Together this resulted in the composite index increasing from a four-month low of 51.8 in March to 52.3 in April.

Service sector respondents reported slightly stronger growth in new orders in April, in contrast to a reported drop in growth of new orders in the manufacturing sector. This divergence was also evident in the surveys' measures of employment, with service sector payrolls reported to have risen in April while manufacturers reported another month of modest layoffs. Similarly, confidence about the twelve-month outlook was reported to have strengthened in the services sector but to have weakened in the manufacturing sector.

Both surveys suggest prices pressures were subdued in April. Service sector input costs were reported to have risen at the slowest pace in six months, with costs reported to have grown at only a modest pace in the manufacturing sector. Respondents in both sectors reported only modest increases in selling prices

The advance in the Caixin service sector PMI headline index reported is broadly in line with the official CFLP non-manufacturing PMI survey, which showed a small increase in its headline index in April. Both the Caixin manufacturing PMI survey and the official CFLP manufacturing PMI survey indicated conditions were little changed in April. Official activity data for April are scheduled for release mid-May.

The Caixin China Services PMI is based on data compiled from monthly replies to questionnaires sent to purchasing executives in over 400 private service sector companies. The panel has been carefully selected to accurately replicate the true structure of the services economy.

The Caixin China Composite PMI is a weighted average of the Manufacturing Output Index and the Services Business Activity Index, and is based on original survey data collected from a representative panel of over 800 companies based in the Chinese manufacturing and service sectors.

The PMIs have developed an outstanding reputation for providing the most up-to-date possible indication of what is really happening in the private sector economy by tracking variables such as sales, employment, inventories and prices. The indexes are widely used by businesses, governments and economic analysts in financial institutions to help better understand business conditions and guide corporate and investment strategy. In particular, central banks in many countries use the data to help make interest rate decisions. PMI surveys are the first indicators of economic conditions published each month and are therefore available well ahead of comparable data produced by government bodies.