China's services activity expanded at a slower pace in January, with the Lunar New Year holidays worsening employment, but business sentiment improved, a private sector survey showed on Wednesday.

The Caixin/S&P Global services purchasing managers' index, slipped to 51.0 from 52.2 in December, but remained above the 50-mark that separates expansion from contraction on a monthly basis.

That echoes the official PMI, which showed services activity weakened to 50.3 from 52.0.

The Caixin survey showed that new business growth eased to a four-month low, while employment fell to the weakest since April 2024.