China’s services activity expanded at a slightly slower pace in June as growth in new business eased, though overseas demand rose at the fastest rate in 20 months, a private-sector survey showed on Friday.
The RatingDog China General Composite PMI eased slightly to 53.6 in Jun-26 from May’s three-month high of 54.0, yet it remains among the strongest prints in three years, signaling robust expansion across both manufacturing and services. This underlying economic resilience is underscored by a thirteenth consecutive month of new business growth and a second straight month of employment expansion, marking the first back-to-back increase in payrolls since mid-2023. On the inflation front, corporate cost pressures moderated as input cost growth cooled to a five-month low; however, solid demand allowed firms to exercise stronger pricing power, pushing output charges up at their fastest pace since Mar-22.
This momentum (slight easing in growth) was mirrored in the services sector, where the RatingDog Services PMI dipped marginally to 54.1 (May-26: 54.4) but comfortably beat market forecasts of 53.0. This represented the third-steepest increase in services activity in nearly three years, driven by robust domestic demand and reinforced by a sharp acceleration in new export business, which expanded at its fastest pace since Oct-24.
China’s underlying data confirms a healthy and self-sustaining recovery in industrial and business activities. Supported by resilient services exports despite trade headwinds, the economy’s momentum suggests that current growth policies are effectively transmitting to the real sector, lowering the immediate pressure for aggressive monetary easing. However, MBSB notes that more targeted policy supports may be needed to promote a more sustainable rise in domestic demand.
