In December 2023, India's services sector experienced substantial growth, buoyed by robust demand and optimistic future prospects, as revealed by an HSBC survey.
The HSBC India Services Purchasing Managers’ Index, compiled by S&P Global, surged to 59.0, marking a significant increase from November's 12-month low of 56.9. In this survey, the 50-mark acts as the threshold distinguishing growth from contraction.
Pranjul Bhandari, HSBC's Chief India Economist, remarked, “India’s services sector ended the year on a high note, with increased business activity primarily driven by a three-month high in the new orders index.”
Projections for the upcoming year appeared promising, evident in the rise of the future activity sub-index compared to November's four-month low. Despite this positive trend, the pace of hiring remained relatively restrained, although it outpaced the previous month.
Companies experienced some relief due to reduced inflation, which slowed the escalation of operating costs. Additionally, they swiftly passed on any additional expenses to consumers, contributing to higher profits.
While the manufacturing sector index for December dipped to 54.9, the vigorous performance of the services sector propelled the overall HSBC India Composite PMI Output Index to 58.5, the most robust in three months.
(With Agency Inputs)
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