China services growth hits 21-month low

beijing — Activity in China’s services sector grew at its slowest pace in 21 months in September as new orders cooled, a private survey showed, blurring the picture of how the economy is performing heading into a key Communist Party Congress.

The findings of the Caixin/Markit survey reinforce views that China’s smaller companies are continuing to struggle, while large stateowned giants are apparently reaping most of the benefits from a year-long, governmentled construction boom.

However, many analysts believe China’s robust industrial rally cannot be sustained much longer, putting pressure on policymakers to finds ways to energise the lacklustre private sector, which accounts for over half of the country’s investment and jobs.

China is counting on growth in services, particularly high valueadded services in finance and technology, to reduce the economy’s traditional reliance on heavy industry and investment.

But Monday’s private survey suggested many services firms are facing a bumpy ride.

The Caixin/Markit services purchasing managers’ index (PMI) fell to 50.6 in September, the lowest reading since December 2015 and one of the weakest since the survey began in 2005.

50.6 was the reading of Caixin/Markit services PMI of China