China’s Caixin Services PMI rises to 6-month highs in Aug, a big beat on expectations

China 's Caixin August Services PMI came in at 52.7 vs 51.5 last and 51.8 expectations.

Summary – Services and Composite PMI data

The Caixin China Composite PMI™ data (which covers both manufacturing and services) indicated that Chinese business activity growth picked up for the second month in a row during August. Furthermore, the latest expansion of activity was the strongest seen for six months, as shown by the Composite Output Index posting 52.4, up from 51.9 in July.

August data revealed that the latest expansion of overall business activity was underpinned by increased activity at both manufacturers and services providers. Notably, services companies registered the quickest upturn in business activity for three months. This was highlighted by the seasonally adjusted Caixin China General Services Business Activity Index rising from 51.5 in July to 52.7. A

Commenting on the China General Services PMI™ data, Dr. Zhengsheng Zhong, Director of Macroeconomic Analysis at CEBM Group said: “The Caixin China General Services Business Activity Index rose 1.2 points from July to 52.7 in August. The index of new business signalled a solid increase in workloads. Input costs increased only marginally while prices charged surprisingly fell to contraction territory. The Composite Output Index increased 0.5 points from July to 52.4, the highest reading since February. The recovery in both manufacturing and services has led the economic outlook to continue to improve. But we need to closely watch whether the recent rises in input costs will weigh on corporate profits and fuel inflation.”