Steep Contraction in Services Follows Latest Covid Wave, Caixin PMI Shows

Activity in China’s services sector contracted at its steepest pace since February 2020 in March as the impact of the latest wave of Covid-19 and the Russia-Ukraine war hit home, a Caixin-sponsored survey showed Wednesday.

The Caixin China General Services Business Activity Index, which gives an independent snapshot of operating conditions in the sector, fell to 42 in March from 50.2 the previous month, the survey report showed. A number above 50 indicates an expansion in activity, while a figure below that points to a contraction. The March reading marked the first contraction in seven months.