Activity in India’s services sector continued to grow at a robust pace last month, a private survey showed but elevated price pressures remained a major concern. The Services Purchasing Managers’ Index, compiled by IHS Markit, eased to 58.1 in November from 58.4 in October, but last month’s rate of growth was the second-best in over a decade.
“The recovery of the Indian service sector was extended to November, with a robust improvement in sales enabling the second-fastest rise in business activity in nearly ten-and-a-half years. Companies were somewhat convinced that output levels would continue to increase in the year ahead, but worries regarding inflationary pressures weighed on confidence again,” said Pollyanna De Lima, Economics Associate Director at IHS Markit.
“Not only did services firms see their expenses increase further in November, but also to one of the greatest extents in a decade. Some of the additional cost burden was shared with customers in November via upward revisions to selling prices,” she said.
India’s manufacturing activity grew at the fastest pace in 10 months in November, buoyed by a strong pick-up in demand, but higher inflationary pressure left factories worried about their future prospects, the PMI survey showed on Wednesday.
Robust expansion in services activity along with strong growth in manufacturing boosted the composite index to a near 10-year high of 59.2 in November from 58.7 in October.
“Looking at the manufacturing and service sectors combined, the results are even more encouraging and bode well for economic performance in the third quarter of fiscal year 2021/22 so far,” added De Lima.
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