Investing.com-- China’s services sector grew more than expected in October, private purchasing managers index data showed on Tuesday, as business activity picked up in the wake of several new stimulus measures from Beijing.
The Caixin services PMI grew to 52 in October, compared to expectations for a print of 50.5, and speeding up from the 50.3 in the prior month.
The stronger-than-expected reading reflected improved export demand, while underlying demand and market conditions also improved in China, Caixin said in a note.
Tuesday’s reading also reflected some pick-up in Chinese activity after Beijing outlined a slew of monetary and fiscal stimulus measures over the past month.
“The effectiveness of these new policies in improving domestic demand, employment and livelihoods will require close monitoring. Additionally, achieving China’s 2024 growth target will depend on a sustained recovery in consumer demand. That means policy efforts should focus on increasing household disposable income,” Wang Zhe, senior economist at Caixin Insight Group wrote in a note.
The Standing Committee of China’s National People’s Congress is set to approve more fiscal spending this week, although investors are uncertain over just how much headroom the country has to increase spending, given its already stretched debt levels.
The Caixin reading was in contrast to official PMI data released last week, which showed growth in non-manufacturing activity slowed in October. But the manufacturing sector edged back up into expansion territory in October.