Cooling economy hits services
By Pan Xiaoyi |
July 6, 2010, Tuesday
|
Print Edition
Print Edition
CHINA'S services sector expanded at the slowest pace in 15 months in June in a further reflection that the country's economic growth has lost some momentum due to harsher policies to curb the overheated property market.
The services purchasing manager's index for June fell for a third month to 55.6 from 56.4 in May, the weakest pace of expansion since March 2009, according to survey results compiled by HSBC and Market Economics. A reading above 50 points indicates expansion while one below suggests contraction.
The index follows a pair of indices last week that showed China's manufacturing activity continued to slow in June amid the government's tightening measures and an uncertain global economic recovery.
"The slowdown in services activities reflects the effects of property market tightening measures," said Qu Hongbin, chief economist for China at HSBC. "This, combined with moderating manufacturing, implies the economy is cooling off sequentially."
Employment in services in the country rose for the 17th month in June, albeit the slowest in four months.
Optimism over the one-year outlook for business activity in the services sector fell to the weakest in 15 months, according to the survey.
The government has unveiled several measures to crack down on property speculation since the second quarter of the year.
The services purchasing manager's index for June fell for a third month to 55.6 from 56.4 in May, the weakest pace of expansion since March 2009, according to survey results compiled by HSBC and Market Economics. A reading above 50 points indicates expansion while one below suggests contraction.
The index follows a pair of indices last week that showed China's manufacturing activity continued to slow in June amid the government's tightening measures and an uncertain global economic recovery.
"The slowdown in services activities reflects the effects of property market tightening measures," said Qu Hongbin, chief economist for China at HSBC. "This, combined with moderating manufacturing, implies the economy is cooling off sequentially."
Employment in services in the country rose for the 17th month in June, albeit the slowest in four months.
Optimism over the one-year outlook for business activity in the services sector fell to the weakest in 15 months, according to the survey.
The government has unveiled several measures to crack down on property speculation since the second quarter of the year.
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