China Caixin services PMI for August 55.0 (expected 54.0)

Caixin / Markit Services and Compiste PMIs for August 2022

Services 55.0

expected 54.0

  • prior 55.5

Composite 53.0

  • prior 54.0

Some of the analysis from the report:

  • Rare high temperatures and sporadic Covid-19 outbreaks were the main factors weighing on the economy in August. The impact of the extreme weather was more significant than that of the outbreaks. The resulting power shortages greatly restricted manufacturing production, whereas service providers remained largely unaffected. The manufacturing sector benefited more from lower expenses as a result of falling commodity prices than the service sector.
  • Right now, the economy is slowly recovering from a widespread outbreak of Covid-19 in the first half of the year, though it remains under pressure. While the central bank has recently cut key policy interest rates to guide banks to lower financing costs for companies and individuals, the effect will depend on market players’ confidence about the future. In addition, with the increase in adverse factors such as recurring Covid-19 cases and natural disasters leading to a sluggish job market and shrinking consumer demand, the government should step up measures such as additional subsidies and assistance for low-income groups.
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