Business activity in China's service sector eased in February as manufacturers reported a further fall in output, according to survey results published on Thursday.
The Caixin China General Services PMI (Purchasing Managers' Index) came in at 51.2 last month, down from January's six-month high of 52.4, according to the survey conducted by financial information service provider Markit and sponsored by financial media company Caixin.
A reading above 50 indicates expansion, while a reading below 50 represents contraction.
The weak data indicated a softening of growth momentum across China's service sector, with business activity expanding at only a modest pace.
In addition, slower increases in both activity and new orders contributed to a weaker expansion of service sector staff numbers, according to the report.
In spite of softer growth, service providers said they were more confident in their business outlook for the next year in February. The level of positive sentiment was at its strongest in seven months, the report showed.
The Caixin China Composite PMI, which covers both manufacturing and services, edged down to 49.4 in February from 50.1 in January, indicating a renewed fall in total Chinese business activity in February.
"Overall, the service sector has outperformed manufacturing industries, reflecting continued improvement in the economic structure," said He Fan, chief economist at Caixin Insight Group.
He said the government should push forward supply side reform in the service sector to capitalize on its potential.
The Caixin China General Services PMI is based on data compiled from monthly replies to questionnaires sent to purchasing executives in over 400 companies.
