China's service industry grows 5.2% YoY in Q1 2026
China’s service sector posted robust growth in the first quarter of 2026, with value added reaching 206,117 billion yuan (20.6 trillion yuan), up 5.2% year on year, according to data released by the National Bureau of Statistics (NBS). The sector accounted for 61.7% of gross domestic product (GDP), an increase of 0.4 percentage points from a year earlier, and contributed 63.2% to overall economic expansion, lifting GDP by 3.2 percentage points. In March alone, the service production index rose 5.0% from a year earlier, maintaining a rapid pace.
Modern services continued to lead the upswing. In the first quarter, value added in information transmission, software and information technology services grew 10.6% year on year, while leasing and business services expanded 12.2%. Together they contributed 1.9 percentage points to service sector growth, 0.2 percentage points more than in the same period of 2025. March production indices for these two sectors accelerated to 11.8% and 10.1% respectively, each gaining 1.7 and 1.9 percentage points from the January–February pace. The financial sector also strengthened, with value added up 6.5% in the quarter, as securities markets stayed active – Shenzhen and Shanghai stock exchange trading volume surged 26.9% and turnover jumped 67.9% year on year.
Innovation dynamism was evident. For January–February, revenue at firms above the designated size in strategic emerging services and high-tech services rose 8.0% and 6.7% respectively, with inspection and testing services up 10.5% and R&D and design services up 10.1%. Digital technology integration fueled industrial upgrades: software and information service platform transaction volume increased 11.7% in the quarter, while digital technology application firms saw revenue climb 10.8% in the first two months. High-tech service fixed-asset investment surged 12.3% in Q1, driven by professional technical services (+29.5%), information services (+20.9%) and R&D and design services (+15.8%).
Service consumption remained buoyant. The service retail sales index rose 5.5% year on year in Q1, outpacing goods retail by 3.3 percentage points. Tourism and recreation platform transactions grew 12.8% year on year, and cultural services platforms rose 8.2%. For January–February, revenue at travel agencies and related services above designated size increased 14.8%.
The services purchasing managers’ index (PMI) returned to expansion territory in March, with the business activity index at 50.2%, up 0.5 percentage points from February. Sectors such as railway transport, telecommunications, broadcasting and satellite transmission services, monetary finance, and insurance all registered indices above 55.0%, indicating rapid growth. Business expectations remained strong, with the services business activity expectations index at 54.8%.
Source: National Bureau of Statistics of China. Original: https://www.stats.gov.cn/sj/sjjd/202604/t20260417_1963343.html