Growth pulse: Services activity picks up in November; PMI rises as new orders strengthen & price pressures ease
India’s services sector regained momentum in November as firms reported a quicker rise in new business and only mild price pressures, helping the industry rebound after losing pace in October, according to PTI. The latest HSBC India Services PMI survey showed a broad improvement in operating conditions, supported by stronger domestic demand.The seasonally adjusted HSBC India Services PMI Business Activity Index climbed to 59.8 in November from 58.9 in October, signalling faster expansion. In PMI terms, a reading above 50 indicates growth, while anything below that marks contraction.“India’s services PMI Business Activity Index rose from 58.9 in October to 59.8 in November, driven by robust new business intakes that fuelled output growth,”said Pranjul Bhandari, Chief India Economist at HSBC.International sales continued to rise, with firms citing orders from Asia, Europe and the Middle East, though the survey noted that the pace of expansion eased to an eight-month low due to “fierce overseas services competition” and the availability of cheaper alternatives elsewhere.“… International sales expanded at an eight-month low due to fierce overseas services competition. Input price inflation reached its lowest rate in nearly five-and-a-half years, resulting in negligible increases in selling charges,” Bhandari said.Employment in the services sector increased in November, but the pace of hiring stayed moderate and broadly in line with trends over the past two months, the survey said.“Employment growth remained modest, with most companies reporting no change in payroll numbers. Meanwhile, India’s composite PMI remained strong, though it softened slightly to 59.7 in November, reflecting a slowdown in growth of factory production,” she added.The HSBC India Composite PMI Output Index eased from 60.4 in October to 59.7 in November, signalling the slowest rate of expansion since May amid softer growth and reduced inflationary pressures halfway through the third fiscal quarter. Composite PMI readings combine manufacturing and services indices based on their official GDP weights.Looking ahead, the survey cited softer optimism among firms, reflecting concerns over competition and potential disruptions linked to state assembly elections. Even so, companies remained broadly positive about future output, aided by expectations of firm demand, wider social media engagement, marketing initiatives and efforts to limit price increases, Bhandari said.The HSBC India Services PMI is compiled by S&P Global using responses from a panel of around 400 service sector companies.
