Financial News: India Services Growth Remains Strong In May

India Services Growth Remains Strong In May

(RTTNews) - India's service sector activity expanded at a broadly steady pace in May on the back of robust international demand, final data compiled by S&P Global showed on Wednesday.

The seasonally adjusted HSBC India Services PMI rose marginally to 58.8 in May from 58.7 in April. The flash score was 61.2. A score above 50.0 indicates expansion.

The survey revealed that the sustained growth in May was underpinned by healthy demand conditions, new client wins, and greater staffing capacity.

New orders grew at a sharp pace amid fruitful advertising, demand strength, and repeat orders from existing clients. There was a near-record improvement in foreign demand for services amid higher demand from Asia, Europe, and North America in particular.

In line with rising new orders, Indian service providers continued to add workforce numbers, with the overall rate of job creation being the strongest in the survey history.

On the price front, input price inflation rose to the highest level this year so far, linked to higher costs for cooking oil, material, and meat. As a result, the rate of charge inflation remained historically elevated.

Looking ahead, service providers expressed a recovery in the overall level of confidence amid expectations that greater staffing capacity, expanded clientele, and marketing initiatives will support activity growth in the year ahead.

The composite output index dropped to 59.3 in May from 59.7 in April, indicating a further sharp upturn in India's private sector economy.

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