Services rise at slowest pace
By Wang Yanlin |
December 6, 2011, Tuesday
|
Print Edition
Print Edition
CHINA'S service sector grew at the slowest pace in three months in November because a cooling economy has slowed the creation of new businesses, an HSBC survey showed yesterday.
The HSBC Business Activity Index, a seasonally-adjusted gauge of the service sector in China, fell to 52.5 points in November from October's 54.1, the lowest in three months and well below the index average of 56.9. A reading above 50 indicates expansion.
By contrast, a Purchasing Managers' Index of non-manufacturing industries, compiled by the China Federation of Logistics and Purchasing, dropped to 49.7 last month from 57.7 in October. The fall signaled a contraction of service activities in China.
The HSBC survey includes more private firms while the federation's index is slanted more toward big state-owned enterprises.
"Despite slower growth in service sector activities in November, employment rose to a five-month high, which should support resilient consumer spending in the coming months," said Qu Hongbin, chief economist for China at HSBC.
"With price pressure easing further, China can and should use policies targeted toward small businesses and service sectors to keep economic growth above 8 percent for the coming year," he added.
The HSBC survey showed that employment levels in the Chinese service sector increased at the fastest pace since June last month, in response to potential need of company expansion plans. The average input costs rose at the slowest pace in 13 months, according to the survey.
Yesterday, Barclays Capital cut its growth forecast of China's gross domestic product next year to 8.1 percent from a previous estimate of 8.4 percent, citing the rapidly deteriorating eurozone growth outlook and a broader domestic property market correction.
It joined other banks, including Citigroup and UBS AG, which cut their 2012 China projections ranging from 8 percent to 8.4 percent.
China's economic growth moderated to 9.1 percent on an annual basis in the third quarter.
The HSBC Business Activity Index, a seasonally-adjusted gauge of the service sector in China, fell to 52.5 points in November from October's 54.1, the lowest in three months and well below the index average of 56.9. A reading above 50 indicates expansion.
By contrast, a Purchasing Managers' Index of non-manufacturing industries, compiled by the China Federation of Logistics and Purchasing, dropped to 49.7 last month from 57.7 in October. The fall signaled a contraction of service activities in China.
The HSBC survey includes more private firms while the federation's index is slanted more toward big state-owned enterprises.
"Despite slower growth in service sector activities in November, employment rose to a five-month high, which should support resilient consumer spending in the coming months," said Qu Hongbin, chief economist for China at HSBC.
"With price pressure easing further, China can and should use policies targeted toward small businesses and service sectors to keep economic growth above 8 percent for the coming year," he added.
The HSBC survey showed that employment levels in the Chinese service sector increased at the fastest pace since June last month, in response to potential need of company expansion plans. The average input costs rose at the slowest pace in 13 months, according to the survey.
Yesterday, Barclays Capital cut its growth forecast of China's gross domestic product next year to 8.1 percent from a previous estimate of 8.4 percent, citing the rapidly deteriorating eurozone growth outlook and a broader domestic property market correction.
It joined other banks, including Citigroup and UBS AG, which cut their 2012 China projections ranging from 8 percent to 8.4 percent.
China's economic growth moderated to 9.1 percent on an annual basis in the third quarter.
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