China service sector activity grows in August

China service sector activity growth accelerated in August as new orders expanded and employment stabilised, a private survey revealed on Monday.

The Caixin/Markit services purchasing managers’ index rose to 52.1 in August on a seasonally adjusted basis from 51.7 the previous month. A reading above 50 signals expansion in sector activity while a level below that indicates a contraction.

Caixin’s composite PMI, which combines services and manufacturing, fell slightly to 51.8 from 51.9 as it was dragged down by the struggling manufacturing sector.

"Overall, the economy continued to expand in August at a pace similar to the growth rate for July,” said Zhong Zhengsheng, director of macroeconomic analysis at the CEBM Group, a subsidiary of Caixin Insight Group.

“But conditions in manufacturing and service sectors diverged again.

"Downward pressure on China's economy remains and supportive policies must continue."