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Economic Times

Services activity rises to 10-month high

India's services sector experienced robust growth in June, reaching a 10-month high with a PMI of 60.4, driven by strong domestic orders and increased international sales. While optimism remains, confidence among service providers has slightly decreased since mid-2022. The finance and insurance sectors led the expansion, accompanied by growth in hiring and a decrease in input cost inflation. Tired of too many ads? Remove Ads Tired of too many ads? Remove Ads Tired of too many ads? Remove Ads New Delhi: India's services sector activity rose to a 10-month high of 60.4 in June, fuelled by rising domestic orders and growth in international sales, according to a private survey released HSBC India Services Business Activity Index was 58.8 in May and 60.5 in June companies ended the first quarter of this fiscal year on a strong footing, with an average Purchasing Managers' Index (PMI) reading of 59.3. However, it was lower than 60.5 recorded in the same quarter last attributed the rise to positive demand trends and continued sales improvement."Services PMI business activity index was up to a 10-month high, led by a sharp rise in new domestic orders," said Pranjul Bhandari, chief India economist at services companies remained optimistic about the future growth, with 18% forecasting expansion, the share of upbeat firms was the lowest since mid-2022."Service providers remained optimistic about future growth, though their confidence faded a tad," said saw the fastest growth in new orders since August 2024. "Services companies benefited most from the continued strength of the domestic market, alongside a marked increase in new export business," the survey sectors, finance insurance recorded the highest growth. The slowest expansion, for both output and new orders, were in real estate and business demand also improved, especially from Asia, the Middle East and the US, according to survey respondents."New export orders also expanded, albeit at a softer pace," noted in the services sector boosted hiring, with employment rising for the 37th month in cost inflation fell to a 10-month low in June. Where expenses increased, panellists cited greater staff salaries and wages."Several service providers noted that they had maintained sufficient pricing power to pass on higher costs to clients," the survey charge inflation eased from May, it remained above the long-term trend. Among sectors, cost pressures were strongest in the consumer services category. In output charges, the fastest upturn was noted in finance & insurance.