India’s service sector activity falls to 60.2 in May – PMI

India services business activity index dropped to 60.2 in May from 60.8 in April, the lowest reading since December 2023 but still above the growth threshold of 50.0, the S&P Purchasing Managers’ Index (PMI) showed on Wednesday.

Rising sales, improved productivity, and sustained demand fuelled growth, although competition and price pressures acted as headwinds, the report said.

New domestic orders grew at a slower pace this year due to competition and heat, despite favourable economic conditions and marketing efforts. However, export orders reached a record high, driven by strong demand from various regions worldwide.

India’s private sector growth slowed in May, with the HSBC India Composite Output Index dropping to 60.5 from 61.5 in April, the slowest rate of expansion since December 2023.

Business sentiment improved in both manufacturing and services sectors despite slower growth. Survey participants showed the highest level of optimism since September 2023, indicating continued confidence in the near-term outlook despite a moderation in expansion.