The S&P Global PMI composite index for China rose to a four-month high of 51.9 in October from 50.3 in September, indicating that the Chinese economy has gained some momentum after officials delivered policy measures aimed at boosting growth late September. The business activity index for China's services sector rose to 52.0 from 50.3, while the headline index for the manufacturing PMI survey, published last week, indicated renewed expansion in the sector. Official PMI survey data, meanwhile, showed slightly stronger conditions in both the manufacturing and the non-manufacturing sector in October.

Respondents to today's service sector survey reported stronger growth in output, new orders, and new export orders in October. The survey showed a second consecutive increase in payrolls while its measure of confidence rose to its highest level since May. Respondents also reported slower growth in input costs and no change in selling prices after two months of declines.

Today's data were much stronger than the consensus forecast of 50.5 for the service sector survey's headline index. The China RPI and the RPI-P rose from plus 64 to plus 86, indicating that recent Chinese data in sum are now coming in well below consensus forecasts.

Expectations for China composite PMI call for a marginal rise to 50.4 in October from 50.3 in September. Services PMI should also improve to 50.5 in October from 50.3 in September.

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.