The purchasing managers index (PMI) for China's non-manufacturing sector stood at 54.1 percent in July, up from 53.9 percent for June, according to official data released Saturday.
A PMI reading above 50 percent indicates expansion, while a reading below 50 percent indicates contraction, according to the National Bureau of Statistics and the China Federation of Logistics and Purchasing (CFLP).
The improving non-manufacturing figure is in line with China's manufacturing PMI, which also rose in July to 50.3 percent from 50.1 percent in June, Xinhua reported.
Cai Jin, vice chairman of the CFLP, said the slight increase indicated a good start for China's economy in the second half of the year.
"Although challenges remain, China's economy has the foundations for steady growth," Cai said.
China's non-manufacturing PMI is based on a survey of about 1,200 companies in 27 industries.
