India’s Services Activity Sees Fastest Growth In Eight Months In June
The Nikkei India Services PMI rose to an eight-month high of 53.1 in June.
A gauge of services sector activity in India grew at the fastest pace in eight months in June driven by strong rise in new work orders amid rising inflationary pressures, a monthly survey compiled by Nikkei and research firm Markit showed.
The Nikkei India Services Purchasing Managers' Index (PMI), which tracks services sector output on a monthly basis, rose to an eight-month high of 53.1 in June. However, the pick-up in job sector was modest but it equalled May's near four-year peak, according to Markit’s statement. By comparison, manufacturing jobs increased fractionally.
In contrast, India’s manufacturing activity gauge fell to a four-month low due to slower growth of factory orders and production, and uncertainties regarding the Goods and Services Tax (GST). The Nikkei India Manufacturing PMI stood at 50.9 in June, compared to 51.6 in May.
June’s results for services sounded a more upbeat tone than those from its sister PMI survey, which showed a slowdown in manufacturing. Growth of service sector activity and inflows of new business picked up as better demand conditions and marketing efforts bore fruit.Pollyanna De Lima, Economist, IHS Markit
On price rise, the report said, inflation picked up to a three-month high but rates were muted which was lower than long-run average. The report further noted that, higher prices paid for food and fuel the average cost burdens at services firms increased further in June.
Going ahead, it is indicated that services activity is expected to rise over the coming 12 months. The optimism was attributed to the introduction of the GST.
An earlier version of the story incorrectly said the services activity gauge saw highest growth in five months instead of eight months in the headline and first para.