China's Caixin Services PMI lower-than-expected in May

China's Caixin Service PMI (May) came in at 51.2 vs 51.8 last, while the Composite stood at 50.5 vs 50.8 prior, both readings lower-than-expected.

Commenting  on  the China General  Services  PMI™ data, Dr. Zhengsheng  Zhong,  Director  of  Macroeconomic  Analysis  at CEBM Group said: “The  headline  Caixin  China  General  Services  PMI  for  May came  in  at  51.2,  down  0.6  from  the  reading  for  April,  marking the  second  consecutive  monthly  decline.  All  of  the  index categories, with the exception of output prices, which remained stable,   showed   signs   of   deterioration.   The   Caixin   China Composite  Output  Index  for  May  was  50.5,  down  0.3  from April’s  reading  but  still  above  the  neutral  50 point   level."

Dr. Zhong  added: "However,  it  also  marked  the  second  consecutive  monthly decline,   underscoring   worsening   conditions   in   both   the manufacturing   and   services   sectors.   Underlying   structural changes  are  still  going  on,  with  the  manufacturing  sector shrinking  and  services  expanding.  The  government  needs  to  continue  to  push  forward  stabilizing  measures  to  help  the economy   recover.   It   should   also   relax   the   control   and regulation  of  the  services  sector  to  enable  it  to  realize  its growth potential and to facilitate the tran sformation and healthy development of the economy."