The Chinese services sector slows down its growth rate in March. The PMI, which is prepared by the private analysts Caixin and Markit, fell from 54.2 points in February to 52.3 points in March. This is the lowest level since November. Any value above 50 points signals for expansion, and every 50 signals for contraction in the sector.
The growth of new orders has slowed, the employment has risen at the lowest rate since 19 months, and the optimism is at the lowest level in six months. Meanwhile, the cost of production resources has risen at a slower pace, while production prices are rising.
Thus, the services sector followed that of the industry, which also reported weaker values in March.
The Chinese authorities rely on growth in the services and consumption sectors to rebalance their model and the economy to rely too heavily on investment and exports. The services account for more than half of the economy, with rising wages leading the Chinese to spend more.
Unlike official data, the Caixin and Markit study focuses on smaller and medium-sized businesses that are under greater pressure on large state-supported companies.
The composite PMI, which unites services and industry, fell to 51.8 points from 53.3 points, which is the lowest level in four months. Both sectors and factory activity expand least since November 2017.