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China's Q1 services sector recovered, accelerated in March
2021/04/07 02:58:18

Apr 07, 2021 (China Knowledge) - A recent survey shows that a recovery in China's services sector has picked up speed in March as firms hired more workers and business optimism surged, although inflationary pressures remained,

The Caixin/Markit Services Purchasing Managers' Index (PMI) rose to 54.3, the highest since Dec, from 51.5 in Feb, well above the 50-mark that separates growth from contraction on a monthly basis. Meanwhile, Caixin's Composite Manufacturing and Services PMI, released on Tuesday, rose to 53.1 in March, up from 51.7 in Feb.

Firms also reported the sharpest increases in activity and overall sales in three months. New export business continued to contract but at a slower pace. A sub-index for employment returned to positive territory as businesses hired more workers than they laid off.

In a statement accompanying the data release Wang Zhe, senior economist at Caixin Insight Group, said that with the Covid-19 flare-ups in the fall and winter having basically died down, the services sector has quickly recovered with supply and demand expanding.

Wang also said that the surveys showed rising input costs and output prices of both the services and manufacturing sectors, which is not conducive to a sustained post-epidemic recovery.

Costs for services firms continued to grow, although at a slower pace than the month before. Companies raised their prices charged for the eighth month in a row and by the largest amount so far this year.

The services sector, more vulnerable to social distancing restrictions, had been slower to recover initially from the pandemic than the industrial sector. Analysts expect a strong rebound in China's full-year growth.

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