BEIJING- China's services purchasing managers' index (PMI) posted 51.8 in January, down from 53.4 in December, announced HSBC Bank (China) on Wednesday.

The sector's performance was in line with the country's manufacturing activity, which waned in January as the manufacturing PMI dropped to 49.8, below the 50-point mark for the first time since October 2012, marking increasing downward pressure on the economy.

A reading above 50 indicates expansion, while a reading below 50 represents contraction.

HSBC said business activity extended growth across China's service sector, though the rate of expansion softened to a six-month low as growth of new work also weakened at the start of the year.

Despite slower growth, service providers were optimistic about this year's outlook. Furthermore, the overall degree of positive sentiment was the strongest since March 2014, the bank added.

Qu Hongbin, chief economist for China at HSBC, said that the Chinese services sector continued to expand in January, albeit at a slower pace while both input and output price inflation eased.

"Given continued contraction of the manufacturing sector, we believe more easing measures are warranted to support growth in the coming months," Qu said.