The S&P Global PMI composite index for China increased to 52.7 in March from 52.5 in February, indicating that China's economy is gaining momentum. The business activity index for China's services sector, also published today, also rose from 52.5 to 52.7, while the previously-published headline index for the manufacturing PMI survey rose from 50.9 in February to 51.1 in March. Official PMI survey data published on the weekend showed a return to expansion in the manufacturing sector and somewhat stronger growth in the non-manufacturing sector in March.

Respondents to today's service sector survey reported stronger growth in output, new orders, and new export orders in March, with the latter growing at the fastest pace in nine months. Payrolls were reported to have fallen marginally, largely driven by resignations and redundancies, while the survey's measure of confidence increased for the first time in three months. Respondents also reported weaker growth in input costs and a smaller increase in selling prices.

Today's data matched the consensus forecast of 52.7 for the service sector survey's headline index. The China RPI rose from plus 71 to plus 79 and the RPI-P fell from plus 90 to plus 75, indicating that recent Chinese data in sum are coming in well above consensus forecasts.

S&P's services PMI in March is expected to edge back to 52.7 versus February's 52.5 and January's 52.7.

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.