China’s trade war with the US continues to impact its economy with its services sector activity declining to an eight month low last month. According to data released by IHS Markit, China’s Caixin services PMI slid to 51.1 in October from 51.3 in September, the slowest pace of growth seen in this sector since February 2019.

Unlike the government’s official PMI figures, Caixin’s PMI consists solely of private sector firms, especially small and medium sized ones. The Caixin composite PMI rose to 52.0 in October from 51.9 in September. Although the rise was very slight, October’s figures are the highest for the composite PMI since April 2019.

New export orders climbed higher across both the manufacturing as well as the services sectors in China, contributing to the improvement in the composite PMI data. This was the first time since May that new export orders in the manufacturing sector registered a positive growth.

Employment growth declined at the fastest pace in a little over a year in the manufacturing sector even as the services sector registered a slight uptick in job growth during October. Overall, employment came in slightly lower in October after rising higher for three consecutive months.

Following the release of this news, the Chinese yuan continues to trade mostly steady against the US dollar. At the time of writing, USD/CNH is trading at around 7.023 after recovering from a sudden spike higher.