The HSBC China services Purchasing Managers' Index rose to a 17-month high of 54.1 in August from 50.0 in July, HSBC Holdings PLC said Wednesday, while cautioning that sub-index readings pointed to a mixed picture of economic recovery.
July's level was the lowest in the nearly nine-year history of the index, and marks the dividing line between expansion and contraction.
Companies in the service sector recorded in August a solid expansion of new business--the strongest since January 2013 --and there was also a further moderate expansion of payroll numbers, HSBC said.
"Apart from the rebound in the headline number, other indices suggest a mixed picture rather than a broad-based improvement," HSBC's chief economist for China , Qu Hongbin , said in a statement.
"The economy still faces downside risks to growth in the second half of the year from the property sector slowdown," Mr. Qu said.
China's official nonmanufacturing PMI edged up to 54.4 in August from 54.2 in July, data from the China Federation of Logistics and Purchasing showed earlier Wednesday.
The HSBC China Services PMI is based on data compiled from monthly replies to questionnaires sent to purchasing executives at more than 400 private service-sector companies.
