Don’t be happy about the Caixin PMI. Pantheon:
A surprise bounce for the Caixin Services PMI
The improvement in the services activity index is unexpected, in light both of the rising Covid cases and tightening restrictions, and of the 1.5pp drop in the official services PMI for July. The explanation most likely lies in the different samples of the two surveys, and the concentration of recent Covid cases away from the coastal regions, which dominate the Caixin measure. The firms sampled have instead enjoyed a continued reopening rebound. New orders also rose, to 53.8 from 52.4, suggesting more activity in the pipeline, though the subindex is a poor predictor of the output index.
