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Caixin: China’s Service Industry PMI Dropped along with Manufacturing PMI

Caixin just released its official Chinese PMI numbers for November. The Caixin PMI is a well-respected economic indicator monitored globally by financial institutions. Along with China’s manufacturing PMI recording at 49.4, continuing the contraction since August, China’s service industry PMI recorded at 46.7, a decrease of 1.7 percentage points from October. This figure has been below the critical point for three consecutive months. It represents a new low since June. Both service production and demand contracted for the third consecutive month in November. Also, the employment index fell to the lowest level since November 2005 when this sub-item was first created. The survey shows that the government’s Zero Covid policy has restricted travel and prevented personnel from returning to work. At the same time, the decline in business demand has also actively tightened employment. Driven by the rising costs of raw materials, transportation and labor, among other items, the costs in the service industry are still increasing. Under the triple pressure of demand contraction, supply shock, and weakening expectations, the employment index has been at a low level for a long time. In the meantime, the National Bureau of Statistics also released its official Manufacturing PMI/ i. It was at at 48.0, and its official Service Industry PMI was at 45.1. Both Showed accelerated a contraction of production and business activities.

(1) Caixin, December 5, 2022
(2) Central Government Official Site, December 1, 2022