Activity in China's service sector expanded at a faster pace in August, a private gauge showed Tuesday, reversing a growth deceleration in the past two months.
The Caixin China services purchasing managers' index rose to 52.7 in August from 51.5 in July, Caixin Media Co. and research firm Markit said. An official gauge released last week pointed to slower expansion in the sector.
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The August reading was the highest in the past three months. A reading above 50 indicates an expansion in activity from the previous month while a level below that points to contraction.
"The recovery in both manufacturing and services has led the economic outlook to continue to improve," Zhengsheng Zhong, director of Macroeconomic Analysis at CEBM Group said.
Both the Caixin and official manufacturing PMIs showed faster expansions in August. However, China's official nonmanufacturing PMI, which includes the construction sector, dropped to 53.4 in August from 54.5 in July, the National Bureau of Statistics said last week.
Stronger growth in activity and new orders led service providers in China to expand their payrolls again in August with the rate of job creation the fastest seen for four months, Caixin said.
"But we need to closely watch whether the recent rises in input costs will weigh on corporate profits and fuel inflation," said Zhong.
(END) Dow Jones Newswires
September 04, 2017 22:21 ET (02:21 GMT)