Growth in China's service sector eases in June - Caixin

(Sharecast News) - Growth in China's services sector eased in June, according to data released on Thursday. Caixin's services purchasing managers' index fell to 50.6 from 51.1 in May. This was below expectations for a reading of 51 and marked the slowest growth in nine months.

A reading above 50 indicates expansion, while a reading below signals contraction.

The data showed that rates of both business activity and new order growth eased compared with May amid another reduction in new export business.

Wang Zhe, senior economist at Caixin Insight Group, said: "Expansion in supply and demand slowed. Despite businesses' efforts to pursue new customers, growth in demand was limited. In June, business activity and total new orders both grew for the 30th consecutive month but at slower clips than the previous month. External uncertainties had a greater negative impact on service exports, with new export business continuing to decline, doing so at the sharpest pace since December 2022.

"Employment declined. In June, the corresponding gauge was in contractionary territory for the third time out of the past four months. Service providers remained cautious about hiring as they continued to prioritize controlling costs. The shrinking workforce led to a moderate increase in backlogs of work, which grew at the fastest pace in a year."