The Services sector results from the latest Sales Managers Survey are very positive. The Market Growth Index is at a 25 month high. The Sales Growth Index is also up at an 8-month high, but more important, the Index registered a very high reading of 54.7 indicating rapid month on month expansion. A recovery in confidence is also evident from the significant growth in November in job recruitment, with the Index now at a 26-month high. Finally, the overall Services Index, which brings together the various readings from the individual indexes, is also reflecting significant growth, with the November reading at a 21 month high.

The Manufacturing survey results continue to suggest that the sector has problems, with a considerable number of companies citing some Covid related supply problems. But the rising Business Confidence Index, now at an 8-month high, suggests that a resumption of growth is likely in the early part of 2024. Furthermore, price inflation seems to be a thing of the past, with the Manufacturing Price Index remaining below the 50 "no growth" line. And finally, the overall Sales Managers Manufacturing Index is now over the 50 "no growth" line and into positive territory.

In summary, the Chinese economy has some way to go before it's growth starts to recall the heady days of 6%+ annual GDP growth. But there seems little doubt that in November, the large Services sector grew rapidly, and the Manufacturing sector is once again off the ground, with growing confidence building in many areas.

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