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An independent gauge of activity in China’s services sector indicates growth slowed further last month, contrasting with a pick-up in bustle at the country’s manufacturers.

Business activity at service providers grew at the slowest pace in four months in February, according to the Caixin-Markit services purchasing managers’ index. The latest reading of 52.6 reflects a fall of 1.8 points from December’s level, though that is still safely above the 50-point line delineating growth from contraction.

Businesses surveyed for the gauge indicated the rate of growth in new orders held steady from January, but noted increased competition had prevented them from raising prices charged to clients in February. That contrasted with input prices, which rose again last month – albeit at a slower pace.

The Caixin gauge tracks smaller, private businesses compared to its official counterpart, which focuses primarily on large, state-owned enterprises. Official PMI readings for January showed activity ratchet up in manufacturing while both services and construction sector growth softened visibly.

The latest number from the independent services gauge, together with a reading of 51.7 from manufacturing, shook out to a composite CPI reading of 52.6 for February, up 0.4 points from January and indicating slight improvement.

Copyright The Financial Times Limited 2017. All rights reserved.
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