India Services Sector Hits Three-Month Growth High in September
India's services sector grew at its fastest pace in three months during September, driven by strong domestic demand despite a slowdown in international orders.
The services sector in India expanded at its fastest rate in three months during September, with the HSBC India Services Purchasing Managers' Index rising to 55.2 from 54.1 in August. This growth was primarily fueled by robust domestic demand for digital, consumer, and financial services. When combined with a seven-month high in manufacturing, the India Composite PMI reached 55.9.
Pranjul Bhandari, chief India economist at HSBC, noted that the service economy ended the second fiscal quarter on a stronger footing than it started. While domestic activity surged, international demand slowed to its weakest pace in nearly three years. Additionally, input-cost inflation dropped to a 10-month low, which reduced the pressure on providers to increase selling prices.
Despite the monthly recovery and a three-month high in business confidence, the overall growth for the July-September quarter was the weakest in more than four years. Employment growth also eased from August levels, with S&P Global reporting a particular slowdown among business services and real estate firms.
