India’s services activity inched up to a six month high in January driven by buoyancy in demand, productivity gains and rising intakes of new work, a private survey data showed on Monday.
India’s services activity measured by HSBC India Services PMI rose to 61.8 in January from 59 in December, the sharpest rate of expansion in six months. The final reading also beat a preliminary estimate of 61.2. With this, India’s services activity reading has remained over the 50-mark separating expansion from contraction for a 30th straight month.
Services activity saw a sharp expansion in business activity in January. New business in the sector saw the quickest increase since July 2023 while new export sales rose at the quickest pace in three months, data showed.
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“India’s services PMI rose to a six-month high in January. New business expanded at a faster pace and managers’ expectations for future activity was strong. The new export business index accelerated, signaling that India’s services exports remained robust,” said Ines Lam, Economist at HSBC.
New sales were boosted by advertising, positive demand trends and new client wins.
“Underlying data also showed a notable upturn in new export orders at Indian service providers in January, the strongest in three months. Monitored firms signalled gains from clients across the globe, including Afghanistan, Australia, Brazil, China, Europe, the UAE and the US,” HSBC said in a press release.
The HSBC India Composite PMI, a weighted average of comparable manufacturing and services PMI indices, rose from 58.5 in December to 61.2 in January. This was the sharpest upturn since mid-2023, data shows.
Private sector sales, driven by service providers, rose at the quickest pace in six months.
“Largely due to a substantial pick-up in cost pressures in the service economy, the aggregate rate of input price inflation quickened to a three-month high. That said, prices charged for Indian goods and services rose at the slowest rate in ten months,” the release read.
