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Informist, Wednesday, Dec. 4, 2024

 

--India Nov services PMI 58.4 vs 58.5 in Oct

--India Nov composite PMI 58.6 vs 59.1 in Oct

 

NEW DELHI - India's services sector activity continued to expand in November, although the HSBC India Services Purchasing Managers' Index edged down slightly to 58.4 from 58.5 in October, S&P Global said Wednesday. The final print for November is lower than the provisional estimate, with the flash PMI released on Nov. 22 pegging last month's services print at 59.2.

 

A PMI reading of more than 50 denotes expansion in activity from the previous month, while a print below 50 is indicative of contraction.

 

"During November, services sector employment notably grew at the fastest pace ever recorded since this survey began in 2005. The hiring surge reflected the sector's improving business confidence, growing new orders, and vigorous international demand. At the same time, high food and labour costs drove up input and output prices to their fastest rates in 15 months and nearly 12 years, respectively," Pranjul Bhandari, chief India economist at HSBC, said.

 

 

Data released on Monday also showed rising input and selling prices for Indian manufacturers in November, albeit not to the same extent. However, the increase in prices of manufacturing products was enough last month for it to hit output, with the manufacturing PMI falling to a joint 11-month low of 56.5. Consequently, the composite PMI for November also declined, coming in at 58.6, against 59.1 in October, S&P Global said Wednesday.

 

The surge in costs for service providers and manufacturers as well as the prices they charge their customers will be closely monitored by the Reserve Bank of India, whose Monetary Policy Committee began its three-day meeting Wednesday, with the interest rate decision due early on Friday. According to most economists, the MPC is likely to leave the repo rate unchanged at 6.50% for the 11th meeting in a row despite GDP growth sliding far more than expected to a seven-quarter low of 5.4% in Jul-Sept. The committee is set to focus on elevated inflation levels, with retail prices rising 6.21% in October--the most in 14 months.

 

In November, Indian service providers said their sales rose at a softer pace than in October, although S&P Global said the index was "consistent with robust growth". Meanwhile, international demand for services continued to improve, with new export orders increasing the most in three months.

 

Despite a marginal decline in the services PMI last month, firms ramped up hiring noticeably, with job additions rising the most in at least 19 years. But despite the rise in payrolls, service providers saw greater pressure on their capacity, as indicated by work pending completion increased at the quickest pace in half a year.  End

 

Reported by Siddharth Upasani

Edited by Avishek Dutta

 

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