India Services Growth Weakest In 5 Months

(RTTNews) - India's service sector activity logged a substantial expansion in October, though at the slowest pace in five months amid competitive pressures and heavy rains, final data compiled by S&P Global showed on Thursday.

The seasonally adjusted HSBC India Services PMI dropped to 58.9 in October from 60.9 in September. The flash score was 58.8. However, a score above 50.0 indicates expansion.

The overall growth in output was attributed to a healthy inflow of new business, greater client footfall, and GST relief, the survey said.

New orders grew at the weakest pace in five months due to heightened competition, floods, and landslides. Nonetheless, firms continued to cite positive demand trends and successful marketing.

External demand was also favorable in October, though external sales growth was at the slowest pace since March. To meet delivery deadlines and maintain reliable services, Indian companies raised their employment level slightly.

On the price front, input price inflation eased to a 14-month low in October, thanks to recently implemented GST reform. As a result, selling prices rose at the weakest pace in seven months.

Looking ahead, companies remained confident about output expectations over the next twelve months, though the level of positive sentiment eased to a 3-month low.

The composite output index dropped to 60.4 in October from 61.0 in September, indicating the softest expansion in the Indian private sector since May.