After the latest manufacturing figures disappointed, HSBC reports China's services grew at the fastest rate in 17 months.
According to figures from HSBC and Markit economics, the purchasing manager’s index posted at 54.1 - the fastest rate of growth since March 2013.
With any reading above 50 constituting growth this is a strong reading; especially given the stagnant 50 reported for July (the lowest post on record).
The HSBC/Markit report cites new product launches and planned product promotions as “key drivers of new business growth in the latest survey period.”
In contrast to the manufacturing sector, which has shed jobs in recent months, the services sector workforce is growing, although not at a particularly fast rate.
Hongbin Qu, economist at HSBC:
The headline HSBC China Services pmi rebounded to a seventeen-month high of 54.1 in August, after registering an all-time low reading in July. Apart from the rebound inthe headline number, other indices suggest a mixed picture rather than a broad-based improvement.The economy still faces downside risks to growth in the second half of the year from the property sector slowdown. We think policy makers should use further easing measures to help support the recovery.