India's February Services PMI Dips to 60.6 Amid Low Confidence

05 Mar, 2024

India's February Services PMI Dips to 60.6 Amid Low Confidence

In February, India's service sector sustained growth amidst positive demand, driving sales and business activity forward. While growth rates moderated from January, they remained historically robust. The HSBC PMI revealed subdued cost pressures since August 2020 and a minimal increase in selling charges, signaling stable market conditions. Despite a slight decline from January, the seasonally adjusted HSBC India Services Business Activity Index stood at 60.6, indicating significant expansion above the neutral mark of 50.0. Employment grew alongside rising workloads, yet concerns over capacity and future outlooks tempered job creation. Business activity expanded across all sectors, with Finance & Insurance leading growth. Ines Lam, HSBC Economist, noted a slowdown in growth due to decreased new orders and output, reflecting slightly weakened business confidence. Nonetheless, demand persisted, with international sales buoyed by orders from various regions. The composite PMI Output Index slipped to 60.6, indicating a softer but still robust expansion in both manufacturing and services sectors. Despite minor setbacks, India's service sector remains resilient, supported by sustained demand and international business growth.