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Apr 3
China's Service Industry Slows In June
Monday, 04 July 2011 05:30

Expansion of non-manufacturing industries or service China slowed in four months in June, raising concerns that efforts to tame inflation limits growth in the second-largest economy in the world.

China Federation of Logistics and Purchasing said on its website, the Purchasing Managers Index (PMI) fell to 57 from 61.9 in May. A reading above 50 indicates expansion. Manufacturing index fell in June to its lowest level in 28 months because of export orders and output grow more slowly. Deputy Prime Minister Wang Qishan said China, China's economic growth target for this year will be difficult to achieve. Previously, Wen inflation target of 4% this year and economic growth of 8%.

"The slowdown is the result of the tightening measures the Chinese government to control inflation," said Shen Minggao.

Non-manufacturing PMI is based on data from industries including real estate, transportation, retail, catering and software. China housing prices decreased in eight of the 10 countries the largest city in June as the government expands efforts to reduce the risk of asset bubbles in the housing market.

Communist Party of China is increasing investment in affordable housing to counter the decline of manufacturing growth. Government efforts to build 10 million housing units this year has increased the demand for construction. Premier Wen Jiabao set a target to build 36 million housing units over the next five years.