A gauge of Chinese business activity outside the factory floor rose to its highest level in 2½ years in August, a sign that Beijing’s efforts to stimulate consumption at home are having an impact, reported the Wall Street Journal.
China’s official nonmanufacturing purchasing managers index rose to 55.2 in August from 54.2 a month earlier, mainly driven by the service sector, the National Bureau of Statistics said Monday. Meanwhile, the manufacturing index, a gauge of China’s factory activity, slipped to 51.0 in August, from 51.1 in the previous month, falling slightly short of market expectations.
Economists said the strong improvement in service-sector activity helped alleviate some concerns about a two-track recovery in China, in which factories rebounded to pre-virus levels relatively quickly, fuelled by external demand as China gained global market share, but in which services, including restaurants and retail outlets, continued to languish amid lingering fears around the contagion.
With coronavirus cases largely contained within China’s borders, said Iris Pang, an economist with ING Bank in Hong Kong, “China’s PMIs show that the economy depends solely on its own demand for economic growth.”