China's service sector cooled in February after new business receded from eight-month highs. HSBC announced earlier today that its China Services Purchasing Managers' Index, a gauge of nationwide service sector activity, fell to 52.1 in February.
The slower factory activity suggests a modest rebound in the world's second-largest economy this year. But the index still held above 50 to show the increasingly important services sector is growing on a monthly basis. Economists attribute to pull-back in services growth in part to a clampdown on excessive state spending.
Chinese officials have been prohibited from hosting extravagant meals and the like. But analysts also expect continuous modest growth of the service sector growth in the coming months, thanks to improving labour market conditions and the ongoing recovery of manufacturing growth.
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