March HSBC China services PMI drops to 51.7

The News (reporter Ma Wenting) experienced a sharp slowdown in February, China's private economic growth in March a small rebound.　　The seasonally adjusted HSBC China Services Business Activity Index (PMI) recorded 51.7 in March, below last month (51.9), the lowest value since December 2008, according to HSBC's latest report yesterday. The March service industry PMI data show that China's service sector has improved further, mainly as a small increase in both business activities and new business. However, the overall increase was less than February and the key index fell to its lowest level since December 2008.　　Meanwhile, rising pay costs have led to a 22-month low in employment growth. The unfinished business of China's services sector continued to fall in March, with the slowdown largely unchanged from last month.　　Data show that the seasonally adjusted March Business index was below 50.0 threshold. In terms of cost, the average cost of investment rose markedly in March, and the survey sample reflected a rise in the price of many commodities during the month, but the most notable increase was pay and fuel.　　As a result, input prices rose to a 4-month high in March, much higher than the long-term average. The service sector has slowed for three consecutive months, reflecting the effectiveness of the tightening policy, said Qu Hongbin, HSBC's chief economist and Asia Pacific Joint head of economic research. As demand cools, rising labour and fuel costs cannot be fully transmitted, helping to curb inflation in the service sector.