New Delhi: The country’s services sector activity in November expanded at the quickest pace since July, driven by new work orders and favourable market conditions, which in turn led to a continued rise in jobs, a monthly survey said.
The seasonally adjusted Nikkei India Services Business Activity Index rose to a four-month high of 53.7 in November, from 52.2 in October, as firms highlighted factors such as favourable market conditions and sales growth that boosted activity.
The services PMI was in the expansion territory for the sixth straight month. In PMI parlance, a print above 50 means expansion, while a score below that denotes contraction.
Meanwhile, the Nikkei India Composite PMI Output Index — that maps both the manufacturing and services sector — rose from 53 in October to 54.5 in November, pointing to the fastest expansion in private sector activity since October 2016.
“The welcoming news complements similar upbeat results in the manufacturing industry, released earlier in the week, and so far suggest that the private sector economy will provide impetus to Q3 FY18 GDP results,” said Pollyanna De Lima, Principal Economist at IHS Markit, and author of the report.
On employment, the survey said that additions to the workforce were maintained for the sixteenth month running.
“So far, 2018 proved to be the strongest year for employment growth for a decade,” Lima added.
On prices, the survey noted that operating expenses in the service sector continued to increase, and in order to protect margins, service providers lifted their selling prices again in November.
Meanwhile, the Reserve Bank of India is scheduled to announce the outcome of its fifth bimonthly monetary policy meeting for 2018-19 later in the day.
The survey noted that business sentiment of service providers strengthened in November, boosted by predictions of gradual improvements in market conditions. Since optimism was higher in the manufacturing economy as well, lifting private sector confidence from October’s 20-month low.
