China’s services sector contracted at the steepest pace in more than 14 years in February, as the gauges for total new businesses and employment plummeted to record lows amid the coronavirus outbreak, reported Caixin.
The Caixin China General Services Business Activity Index, which gives an independent snapshot of operating conditions in the services sector, fell to 26.5 in February from 51.8 in the previous month. The February reading was the lowest since the survey began in November 2005. A number above 50 indicates an expansion in activity, while a figure below that points to a contraction.
The reading follows a sharp decline in the Caixin China General Manufacturing Purchasing Managers’ Index (PMI), which fell to a record low of 40.3 in February. The Caixin China Composite Output Index, which covers both manufacturing and service companies, tumbled to an all-time low of 27.5 in February from 51.9 the previous month.
The services PMI survey of roughly 400 companies in the sector was carried out from Feb. 12 to Feb. 21. The majority of surveyed companies identified the coronavirus outbreak as the key driver of reduced services activity.