Reuters Insider - China's services sector faces worry

PMI

01/04/2015 09:38

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 https://insider.thomsonreuters.com/link.html?cn=share&cid=1394918&shareToken=MzoyYjU4YjcyZS03NDc5LTQ3ZWItOWRjMS01MTIzZDNlMGQzYWI%3D&playerName=ReutersNews 
                                                                       
 Source:             Thomson Reuters                                   
                                                                       
 Description:        China's slowdown continues to hurt the            
                     manufacturing sector, but a cooling in the        
                     services sector in March marks more worries for   
                     the world's second largest economy. Jane Lanhee   
                     Lee reports.                                      
 
 
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 Short Link:  http://reut.rs/19C2H3N  
 
 
Transcript (May be auto-generated)

 The service sector is cooling off in China. That's bad news as it was the lone 
bright spot for the world's second largest economy last year. The official 
non-manufacturing PMI for March came in at 53.7 slipping from 53.9 in February 
back to January's level which marked the lowest in a year. In 2014, the service 
sector made up nearly half of the economy and created more jobs even as China's 
factory floor struggled. But the recent more sluggish numbers are raising 
concerns service companies too are getting hit by the wider economic downturn. 
China's manufacturing sector has been struggling and both the official and 
private surveys for March PMI came in just above and below the 50 line that 
marks expansion from contraction. Some data also indicates that job losses at 
factories continue to accelerate. Keeping employment steady to avoid any social 
unrest has been one of Beijing's top priorities and it's been using rate cuts 
and looser monetary policies to jumpstart the engine but with limited impact so 
far. Part of the problem has been China's sagging housing market which has a 
knock-on effect on everything from steel to furniture. Earlier this week, the 
government cut down payments on housing purchases and gave a tax break on sales 
to help step up the fight against sliding prices. But many are looking to the 
country's Central Bank as more measures will be needed for China to avoid 
slipping further into trouble