China’s Caixin services PMI for June came in at 52.0 vs. 53.0 expected and 52.7 last, which showed that the manufacturing slowdown drags business activity growth down to eight-month low.
Meanwhile, the Composite Output Index eased to 50.6 in June from May’s reading of 51.5.
Quotes from Dr. Zhengsheng Zhong, Director of Macroeconomic Analysis at CEBM Group:
“The Caixin China General Services Business Activity Index fell further to 52 in June from the previous month. Among the gauges included in the survey:
1) The gauge for new business rebounded and was higher than the levels seen for most of last year, likely due to the reacceleration of fiscal policy support. New export business returned to contractionary territory, pointing to subdued foreign demand.
2) The employment measure fell further but remained in positive territory, suggesting that the capacity of the services sector to absorb labor weakened.
3) Gauges for input costs and prices charged by service providers both fell but stayed in expansionary territory, with the former still higher than the latter, showing that services companies remained under significant cost pressure.”
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