But the Caixin Composite Output Index, which reflects the nation’s combined service and manufacturing activity, saw the fastest growth rate since September 2014, rising to 51.9 in July from 50.3 in June.
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The government had stated earlier this year that policy enablers like maintaining regularity, transparency in services sector data also needed to come in first.
The hotels and restaurants sector, hit by a wave of bloody attacks claimed by Islamic State in French cities such as Paris and Nice, continued to register sharply falling activity, Markit said.
“There were slight increases in new business and employment evident in the latest survey data, but overall little sign of any change to the subdued pattern seen throughout the year to date”, Markit economist Jack Kennedy said.
China’s service sector growth slowed in July as the Caixin General Services PMI slipped to 51.7, down from the 11-month high of 52.7 posted in June. Encouragingly for firms, the stabilization of backlogs ended a five-and-a-half-year period of decline and contributed to renewed job growth and stronger business confidence.
Amid reports of lower prices paid for fuel and some commodities, average input costs facing service providers fell in July. July marked the first contraction since December 2012 and the strongest rate of decline since March 2009. Prices charged by services providers increased slightly.
Markit said companies widely reported that the outcome of the European Union referendum had weighed on new business inflows during the month. A reading above 50 represents expansion, while one below this level means contraction.
“Many businesses could have adopted a wait-and-see attitude amid the Brexit-related uncertainties”, she said.
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Business sentiment among Indian service providers improved during July, with the degree of optimism reaching a four-month high. Those survey participants forecasting higher levels of output in the coming 12 months commented on expectations of better economic conditions and planned increases in marketing budgets.
