China's services sector hits a speed bump, but optimism grows for 2026
China's services sector cooled off in December 2025, with growth dipping to its slowest pace in six months (PMI at 52.0).
Fewer new orders and a drop in export business—thanks to less tourist activity—are behind the slowdown.
Still, businesses are feeling more upbeat about the future, with confidence reaching a nine-month high, supported by forecasts of improved market conditions and expansion plans for 2026.
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Even with rising costs for companies (for the 10th month straight!), competition is so tough that many are actually lowering their prices.
The government is aiming for around 5% growth this year despite challenges like job cuts, property market troubles, and deflation worries.
On the bright side, China's overall economy is still inching forward, with both manufacturing and services showing slight improvement.