BEIJING-A private gauge of China’s service activity showed a faster pace of expansion in March after Beijing moved to prop up growth in the world’s second largest economy.
Advertisement
“March PMI surveys signalled a reassuringly robust end to the financial year for the Indian economy, with sharper increases in new business spurring activity growth in both the manufacturing and service sectors”, said Pollyanna De Lima, economist with Markit.
Consumer inflation cooled to 5.18 percent in February and, coupled with the government’s adherence to fiscal consolidation in its budget, prompted the Reserve Bank of India to cut its benchmark lending rate by 25 basis points to a more than five-year low of 6.50 percent on Tuesday.
“Input costs across the private sector meanwhile rose at the quickest rate in three months and charge inflation likewise accelerated, suggesting that headline inflation may pick-up in coming months”.
On the price front, input price inflation faced by the service providers was modest overall. As was the case with output, however, the rate of expansion was only slight.
Services’ firms in India continue to be positive that activity will further expand in the following 12 months.
Private sector activity in the country registered a significant uptrend and surged to a 37-month high in March, driven by a marked increase in new business orders, a monthly survey said. Consequently, composite employment fell at the sharpest rate since January 2009.
The Caixin China Composite PMI jumped to 51.3 from February’s 49.4, signaling renewed increase in overall Chinese business activity. At the same time, cost burdens at manufacturing firms increased for the first time in 20 months. Purchase price inflation among goods producers was at a three-month high. Manufacturers also cut their payroll numbers in March.
“Some respondents commented that improving underlying market conditions had helped to secure new work”, according to the Caixin/Markit report.
“Overall, the services sector developed well, but the economy is riding choppy waves, indicating the lack of a solid foundation for a recovery”, He Fan, chief economist at Caixin, said in a note.
Advertisement
“One disappointment is the trend in employment, which showed little change through much of 2015-16, Lima added”.
