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India’s services sector activity growth eases to 60.8 in April
May-06-2024

India’s services sector activity growth eased during the month of April but still one of the strongest growth rates seen in just under 14 years, amid favourable economic conditions, demand strength and rising intakes of new work. According to the survey report, the seasonally adjusted HSBC India Services PMI Business Activity Index fell to 60.8 in April from 61.2 in March. Further, the HSBC India Composite PMI Output Index -- which measures both manufacturing and services -- also eased to 61.5 in April as against 61.8 in March. 

The survey report noted that a few service providers in India showed an increased appetite for new hires in April, buoyed by rising inflows of new business. However, with several companies indicating that payroll numbers were sufficient for current requirements, the rate of job creation was marginal and softer than that seen at the end of the previous fiscal year. Outstanding business meanwhile increased for the twenty-eighth consecutive month in April, albeit at a slight pace that was softer than in March and broadly aligned with the average over this sequence.

On the price front, wage pressures and higher food prices led to another increase in cost burdens, which firms partially passed on to their customers. However, charge inflation eased from March's near seven-year high. Meanwhile, confidence among service providers towards the year-ahead outlook for business activity improved to a three-month high. Marketing efforts and efficiency gains, alongside plans to price competitively and predictions that demand conditions will remain favourable, boosted optimism.


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