China's non-manufacturing sector shrinks in May

The performance of China's services, or non-manufacturing, sector slightly declined in May, compared with April.

The purchasing managers index, the P-M-I, for the non-manufacturing sector fell to 54.3-percent in May from 54.5 percent in April, a 0.2-percent decline. A PMI reading above 50 percent indicates expansion, while a reading below 50 percent indicates contraction. In May, the service commercial activity index came in at 52.3, down 0.2 points from the previous month. The index for the construction sector was 62.2, down 0.2 percent from April.

Indexes for loading and delivery, retail, aviation transport, wholesales, renting are above 50. Business shrank for residential services, environmental protection and public facility management, as well as mail and catering services, with PMI indexes below 50.

Experts say the performace of service sector was steady in May, with slight shrinking of market demand. 

Cai Jin, Vice-Chairman of China Fed. of Logistics and Purchasing, said, "Generally, the performance of the non-manufacturing sector is steady. Highlights of the PMI index for May are the growth of online business and IT technical support. But costs in the service sector are rising, which will increase the pressure on inflation. Now we should focus on how to increase the demand for services."