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India's Services Sector Growth Continues As Export Demand, Hiring Rebound
Imagine a big shop that sells services instead of toys.
In July, this shop was still busy, but a little less busy than it was in June.
A special number called the PMI was 53.3, and any number above 50 means the shop is doing well.
People from countries like the UAE, the UK and the US wanted to buy Indian services, which helped a lot.
But the shop got fewer new customers than before because competition was tough.
Even so, it hired more workers after a slow month in June.
The cost of running the shop went down a little, so the owners could keep more of their money.
They also raised their prices a bit, which customers still accepted.
The people running the shop still feel good about the future, though not as good as a few months ago.
Overall, India's services businesses are still growing, just a little more slowly.
India's HSBC Services PMI Business Activity Index stood at 53.3 in July, down from 57.4 in June but above the 50-mark separating growth from contraction.
Strong overseas demand from clients in the UAE, the UK and the US helped new export orders grow faster than overall new business.
New business inflows expanded for another month, though at the weakest pace since February 2022 due to softer demand, competition and fewer enquiries.
Hiring rebounded from June's six-month low as service providers continued to expand their workforce.
Input cost inflation softened to a six-month low below the long-run average, while selling prices rose at the fastest pace since April and business optimism eased to a seven-month low.
- Who
- India's service providers, HSBC chief economist Pranjul Bhandari, and clients in the UAE, the UK and the US
- What
- India's services sector stayed in expansion in July, with the HSBC Services PMI at 53.3, supported by surging export demand and a rebound in hiring
- Where
- India
- When
- July, with the data released on Wednesday
- Why
- Healthy export demand from the UAE, the UK and the US, along with continued hiring, kept the sector growing even as new business growth slowed
Key facts
- HSBC India Services PMI (July)
- 53.3
- PMI in June
- 57.4
- HSBC India Composite PMI Output Index (July)
- 54.3
- Growth-contraction threshold
- 50
- New business growth pace
- Weakest since February 2022
- Input cost inflation
- Six-month low, below long-run average
- Selling prices
- Fastest increase since April
- Business optimism
- Seven-month low
Quotes
Pranjul Bhandari
Chief India Economist at HSBC
“"India's services sector continued to expand in July, albeit at a slightly slower pace, as new business growth eased in both domestic and export markets after several months of strong performance. Hiring showed a moderate rebound, while profit margins improved as input costs softened and firms increased their selling prices."”
freepressjournal.in
Sources
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