BEIJING, Nov 5 (Reuters) – Growth in China’s services
industry edged up in October, a private survey showed on
Tuesday, offering further indications that the economy has
stabilised in the run up to a key party reform meeting.
The Markit/HSBC services PMI rose to 52.6 from September’s
52.4, well above the 50 line that separates expansion from
contraction.
The survey showed new business growth was at a seven-month
high and the business outlook for the next 12 months improved on
the previous month, though it was still below trend. Employment
levels also ticked up.
“Service sectors saw modest but broad-based improvement into
4Q,” said HSBC economist Qu Hongbin, in a note accompanying the
data.
“This should help cement China’s growth momentum in the
coming months.”
The overall message tallied with that in China’s official
services PMI on Sunday, which showed a rise to 56.3, the fastest
increase in 13 months.
But the two surveys differed in their reports for new
orders, with the HSBC survey showing an increase to the highest
level since March, while the official survey registered a
decrease from the previous month.
The official survey is weighted towards bigger and
state-owned firms and tends to come in higher than the HSBC
survey, which focuses on smaller and private businesses.
Beijing hopes that the services industry, which has so far
weathered the global slowdown much better than the factory
sector, will become an increasingly important pillar in the
economy, allowing China to move away from investment and exports
as the main drivers of growth.
Ways to restructure the economy along those lines are
expected to the major focus of the third plenary meeting of top
party officials opening on Sunday.
Top-ranking Chinese politicians have stated that the meeting
will yield “unprecedented” reforms, though how far the
government is prepared to act on these intentions is likely to
only become clear with time.
Services accounted for about 45 percent of the economy in
2012 and is the biggest employer in China.
Tuesday’s survey followed a pair of PMIs that showed
activity in China’s manufacturing sector picked up in October.
The official manufacturing PMI increased to 51.4 from 51.1
in September, while the final Markit/HSBC PMI increased to 50.9
from September’s 50.2.
(Reporting By Natalie Thomas; Editing by Kim Coghill)
