As per the index, compiled by S&P Global, the growth in the services slowed as the robust domestic demand weakened.
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The growth in India’s services activity slowed to a five-month low in May, according to the HSBC India Services purchasing managers’ index.
As per the index, compiled by S&P Global, the growth in the services slowed as the robust domestic demand weakened.
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The data also showed exports growing at a record pace and job creation rising to a 21-month high.
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The final HSBC India Services purchasing managers’ index, compiled by S&P Global, fell to 60.2 last month from April’s 60.8, confounding a preliminary reading for a rise to 61.4.
However, it remained above the 50 mark separating growth from contraction for the 34th straight month.
The report highlighted that even though the new business sub-index, a key gauge for demand, remained robust in May, it grew at the slowest pace this year due to fierce competition and heat waves across the country hampering livelihood.
Exports expanded at the steepest pace since the inclusion of the sub-index in the monthly survey nearly a decade ago.
With signs of recovery in China and economic activity remaining resilient in the US, the recent pick up in global demand could continue.
Strong sales led the business outlook for the coming 12 months to climb to an eight-month high, encouraging services firms to add jobs at the fastest pace since August 2022.
Maitreyi Das, global economist at HSBC said, “India’s service activity rose at a slightly softer pace in May, with domestic new orders easing slightly, but remaining robust, implying strong demand conditions and successful advertising.”
“Cost pressures ticked up in May led by higher raw material and labour costs. Firms were only able to transfer a part of the price rise to customers,” added Das.
Since the business activity both in manufacturing and services eased slightly in May, it meant the overall HSBC India composite PMI output index fell to a five-month low of 60.5 last month from April’s 61.5 and below a flash estimate of 61.7.
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