BEIJING (Reuters) - Growth in China’s services sector slowed in August, hitting the lowest level since May 2016, an official survey showed on Thursday.
The official non-manufacturing Purchasing Managers’ Index (PMI) fell to 53.4, from 54.5 in July, raising fresh questions about the health of China’s services sector.
The services sector accounts for over half of China’s economy, with rising wages giving Chinese consumers the opportunity to shop and travel more.
China’s leaders are counting on growth in services and consumption to rebalance their economic growth model from its heavy reliance on investment and exports.
China posted stronger-than-expected economic growth of 6.9 percent in the first half, fuelled by a year-long construction boom, resurgent exports and robust retail sales.
But economists have expected the pace to slow slightly in the second half due to higher financing costs, a regulatory clampdown on riskier lending and some signs of moderation in the red-hot housing market.
Reporting by Beijing Monitoring Desk and Elias Glenn; Editing by Kim Coghill