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06 Apr 2021 | 08:16

China services recovery accelerates in March

(Sharecast News) - The recovery in China's services sector accelerated in March, according to figures released on Tuesday. The Caixin services purchasing managers' index rose to 54.3 from 51.5 in February, coming in comfortably above consensus expectations for a reading of 52.1. A level above 50.0 signals expansion, while a level below indicates contraction.

Wang Zhe, senior economist at Caixin Insight, said: "The Covid-19 flare-ups that occurred in the fall and the winter have basically died down, and the services sector has quickly recovered with supply and demand expanding."

Freya Beamish, chief Asia economist at Pantheon Macroeconomics, said: "The pace of increase in new orders picked up to the fastest in three months. The fresh activity was enough to lead to the first rise in backlogs of work in five months, and a modest increase in headcount, after a small fall in February.

"The output price rises quickened. Survey data continue to point to a strong rebound in CPI inflation but the hard data will remain held back until some semblance of normality returns to the travel industry.

"Finally, confidence bounced to its highest since early 2011, probably reflecting the fact that the outbreak starting in Hebei has been put to bed. It's possible that businesses are getting a little ahead of themselves, though, given the slow progress on the vaccine."

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