India’s services PMI falls to 60.1 in August from 62.3 in July
The S&P Global India services Purchasing Managers’ Index (PMI) in August fell to 60.1 from 62.3 in July as growth in dominant services industry lost some steam, showed the official data on Tuesday.
However, the overall conditions remained robust despite elevated inflationary pressures, as per the business survey that showed exports were at a record high on robust foreign demand.
The reading was above the 50-mark separating growth from contraction for a 25th consecutive month – the longest stretch since August 2011.
Tuesday’s findings, coupled with a sister survey on Friday which found factory growth expanded at its fastest pace in three months, suggest Asia’s third-largest economy will be the fastest-growing major country despite slowing global growth.
“This spike in international demand supported one of the best sales performances recorded over the past 13 years, and acted as a catalyst for firms to expand their workforces as well as output,” noted Pollyanna De Lima, economics associate director at S&P Global.
“Demand strength also fostered a heightened sense of optimism regarding the outlook, boding well for economic growth prospects.”
A sub-index monitoring overall demand slowed slightly in August compared to the previous month. Although it remained strong at 60.0 it was below July’s 13-year peak of 62.2.
Foreign demand was its highest since the series began in September 2014.
The business outlook for the next 12 months was the most robust since December, encouraging firms to hire at the fastest pace in nine months.
However, inflationary pressures quickened and the prices charged index reached a peak last seen in June, even though input prices rose at a slower pace.