China Caixin PMI Services dropped to 26.5 in February, down from 51.8, well below expectation of 48.0. Markit said the sharply decline in activity was due to travel restrictions and company closures. There were record falls in total new work and export sales. Outstanding work rose substantially. PMI Composite dropped from 51.9 to 27.5.
Zhengsheng Zhong, Chairman and Chief Economist at CEBM Group said: “The coronavirus epidemic has obviously impacted China’s economy. It is necessary to pay attention to the divergence of business sentiment between the manufacturing and the service sectors. While recent supportive policies for manufacturing, small businesses and industries heavily affected by the epidemic have had a more obvious effect on the manufacturing sector, it is more difficult for service companies to make up their cash flow losses.”
