China services sector expands more than expected in December - Caixin

Activity in China’s services sector expanded more than expected in December, according to a survey released on Thursday.

The Caixin services purchasing managers’ index rose to 52.9 from 51.5 in November, coming in above consensus expectations of 51.6 and marking the highest level since July. A reading above 50.0 indicates expansion, while a reading below signals contraction.

Overall new orders rose 2.5 points to 53.7 - the highest since May - while the index for new export orders was up 0.7 points to 52.2.

Pantheon Macroeconomics noted that again, the Caixin PMI showed the opposite picture to the weak official services PMI, which was unchanged at 49.3.

"The mixed picture from the Caixin and official services PMIs points to the regionally uneven nature of China’s recovery and we expect a continued soft recovery in 2024, as households worry about income growth and broad economic prospects," said chief China+ economist Duncan Wrigley.