The S&P Global PMI composite index for China rose from 50.0 in October to 51.6 in November, indicating that China's economy regained some momentum after ten consecutive months of steadily weakening expansion. The business activity index for China's services sector, also published today, rose from 50.4 to a three-month high of 51.5, while the previously-published manufacturing PMI survey showed a increase in its headline index from 49.5 to 50.7, also a three-month high.

Official PMI survey data published last week, in contrast, showed slightly weaker conditions in both the manufacturing and non-manufacturing sectors in November. Together, these PMI surveys suggest that China's economy remains weighed down by weakness in the property market despite recent measures aimed at improving liquidity conditions. This may strengthen the case for further policy adjustments in coming weeks.

Respondents to today's service sector survey reported stronger increases in output, new orders, and new export orders in November. Payrolls were reported to have been cut slightly but the survey's measure of confidence increased, with respondents cautiously optimistic about the outlook for the next twelve months. Respondents also reported weaker growth in input costs and a smaller increase in selling prices.

Today's data were above the consensus forecast of 50.7 for the service sector survey's headline index and 50.1 for the composite PMI. The China RPI and the RPI-P rose from plus 7 to plus 14 and from zero to plus 17 respectively, indicating that recent Chinese data in sum are coming in above consensus forecasts.

S&P's services PMI is expected to improve slightly to 50.7 in November versus October's 50.4 and September's 49.5. The composite PMI is expected at 50.1 in November versus 50.0 in October.

The S&P 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 S&P 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.