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China's non-manufacturing sector rebounds in December

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BEIJING, Jan.4 (Xinhua) -- The growth of China's non-manufacturing sector saw a dramatic rebound in December, as indicated by a rise in the Purchasing Managers Index (PMI), according to the China Federation of Logistics and Purchasing (CFLP).

The non-manufacturing sector's PMI, a key economic indicator, grew to 56 percent in December from 49.7 percent a month earlier, the CFLP said.

A PMI reading above 50 indicates expansion from the previous month, while a reading below 50 indicates contraction.

The decline means China's non-manufacturing sector is back to growth after two months of decline.

It also comes after China's PMI, a preliminary readout of the country's manufacturing activity, rebounded to 50.3 percent in December, up 1.3 percentage points from 49 percent in November, indicating a stabler slowing trend of economic growth.

The CFLP contribute the rebound to the strong demand from the retailing and catering sectors during the pre-holiday season, as well as a buoyant growth in logistics.

Major sub-indices for the non-manufacturing sector rose significantly from a month ago, with the index for consumer services up 9.1 percentage points to 55.1 percent in December. The index for new orders also posted a rise of 5.9 percentage points to 50.8 percent.

For the retailing sector alone, the index for business activities and new orders both climbed to above 70 percent, according to the CFLP.

However, despite a boom in the service sector, the PMI reading suggested a less remarkable performance in the construction and real estate sectors, with the index of business activities for construction remaining flat, with the November level at 55.4 percent, and that of real estate at 44.3 percent.

The real estate new order index was down to 39.3 percent in December, the lowest level since March 2011.

Cai Jin, vice president of the CFLP, said further reform and more favorable policies in taxation will promote a stable development in the service sector and a growth in consumer demand.

With a slowed growth in exports and investment, China is facing a shift in economic momentum, he added.

The federation's non-manufacturing PMI is based on a survey of about 1,200 companies in 20 industries including transport, real estate, retailing, catering and software.

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