Service PMI: The growth of India's services sector stagnated in November as new work orders saw slowest rise in over three months and confidence waned, says a survey.
Service PMI: The growth of India’s services sector stagnated in November as new work orders saw slowest rise in over three months and confidence waned, says a survey.
Falling from October’s eight-month high of 53.2 to 50.1 in November, the seasonally adjusted Nikkei Business Activity Index pointed to broadly unchanged levels of services activity across the country.
The gloomy trend was also observed in the labour market, as employment rose at a pace that was historically muted.
“Service sector output in India broadly stagnated and confidence waned in November, following four consecutive months of increases,” the survey said.
Meanwhile, the seasonally-adjusted business activity index grew only fractionally above the no-change mark of 50.
A reading of 50 divides growth and contraction.
“Services companies in India displayed a lack of optimism with regards to the 12-month outlook for activity, as sentiment dropped to the lowest in the ten-year survey history,” the survey noted.
On the prices front, it said output prices in the Indian services sector stabilised in November.
The survey members blamed fierce competition and frail economic conditions for the slowdown in growth of new work.
Manufacturing sector grew at its slowest pace in 25 months in November on sluggish pace of new business orders.
Meanwhile, India’s economy grew by 7.4 per cent in July-September quarter, outpacing China to become the fastest growing major economy.
The Reserve Bank has left its policy rates unchanged, as was widely speculated, and promised more easing when permitted within its key task of keeping inflation under check.