The services sector in China continued to expand, with the pace of expansion picking up into November and supporting expectations of economic recovery in the aftermath of the coronavirus crisis. The Caixin/Markit services PMI reading increased to 57.8 for the month of November from 56.8 in November, the second highest level seen in over 10 years.

The surge in the services sector activity was driven by an increase in new business, with new export business registering growth for the first time in five months. The improvement in external demand is likely to support growth in China’s export-reliant economy significantly.

Hiring activity also continued to increase across the services sector in China, rising for the fourth consecutive pace and expanding at a faster rate. Meanwhile, business confidence among companies in this sector rose to the strongest level seen in nearly 10 years.

Senior economist at Caixin Insight Group, Wang Zhe, observes, “To sum up, both the manufacturing and service sectors recovered at a faster pace as overseas demand kept expanding and employment saw substantial improvement. We expect the economic recovery in the post-epidemic era to continue for several months.”