India’s Services Sector Keeps Growth Momentum Alive In July As Export Demand Surges & Hiring Rebounds
· Free Press Journal
New Delhi: India's services sector remained in expansion territory in July due to healthy export demand and continued hiring, according to the HSBC India Services PMI data released on Wednesday.
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The seasonally adjusted HSBC India Services PMI Business Activity Index came in at 53.3 in July from 57.4 in June, remaining above the 50-mark that separates growth from contraction.
Meanwhile, service providers continued to report growth in activity with strong overseas demand emerging as a key support factor.
Companies cited improved business from clients in the UAE, the UK and the US, helping new export orders grow at a faster pace than overall new business.
The data also highlighted that new business inflows expanded for another month, although the pace of growth slowed to its weakest level since February 2022 as firms reported softer demand conditions, intense competition and fewer customer enquiries.
Hiring activity improved from June's six-month low, with service providers continuing to expand their workforce. While the increase in employment remained modest, stronger hiring in services helped boost overall job creation across the private sector.
"India's services sector continued to expand in July, albeit at a slightly slower pace, as new business growth eased in both domestic and export markets after several months of strong performance. Hiring showed a moderate rebound, while profit margins improved as input costs softened and firms increased their selling prices," said Pranjul Bhandari, Chief India Economist at HSBC.
According to the latest data by HSBC, input cost inflation softened to a six-month low and remained below the long-run average despite higher fuel, labour, material, technology and transportation expenses.
At the same time, firms increased selling prices at the fastest pace since April, supporting margins.
In addition, business sentiment remained positive aided by expectations of improved demand, better market conditions and higher inbound tourism. However, overall optimism eased to a seven-month low.
Additionally, the HSBC India Composite PMI Output Index -- which tracks both manufacturing and services activity -- stood at 54.3 in July showing continued expansion in private-sector activity.
(Except for the headline, this article has not been edited by FPJ's editorial team and is auto-generated from an agency feed.)