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China’s Services Activity Shows Growth in December
BEIJING – China’s services activity expanded at the fastest pace in seven months in December, driven by a surge in domestic demand. However, orders from abroad declined, reflecting growing trade risks to the economy, a private sector survey showed on Monday.
Growth in Caixin/S&P Global Services Purchasing Managers’ Index
The Caixin/S&P Global services purchasing managers’ index rose to 52.2 in December from 51.5 the previous month. This growth pace was the fastest since May 2024, surpassing the 50-mark that separates expansion from contraction on a monthly basis.
Alignment with Official PMI Results
The findings from the private sector survey broadly align with China’s official PMI released last week, which indicated non-manufacturing activity recovered to 52.2 from 50.0 in November.
Challenges in China’s Economy
China’s economy has faced challenges in recent years, including weak consumption and investment, as well as a severe property crisis. The potential for more U.S. tariffs under a second Trump administration could impact exports.
Government Measures to Revitalize the Economy
To revitalize the faltering economy, authorities introduced a blitz of fiscal and monetary measures in recent months. Senior Economist Wang Zhe at Caixin Insight Group noted that these measures have produced more positive factors in the market.
Impact on Business Operations
The survey showed that new business inflows from abroad fell for the first time since August 2023. Companies also reduced staff for the first time in four months, citing cost concerns such as rising input material prices and wages.
Concerns and Business Confidence
Despite a positive business confidence reading, some companies expressed concerns over rising competition and potential international trade disruptions. The external environment is expected to become more complex, requiring careful policy preparation and responses.
Risk of Tariffs and Global Trade Disruptions
With the inauguration of a second Trump administration looming, concerns over potential tariffs exceeding 60% on Chinese goods pose a major risk for the world’s second-biggest economy.
Composite PMI Decline
The Caixin/S&P Global Composite PMI, which combines the manufacturing and services PMIs, declined to 51.4 from 52.3 in November.
This article was generated from an automated news agency feed without modifications to text.
