India Services Sector PMI Slips To 17-month Low In June
As per the survey, the seasonally adjusted HSBC India services purchasing managers’ index (PMI) fell to 57.4 in June, from 59.8 in May, registering the weakest upturn in 17 months, while the index stayed above the neutral mark of 50.0
New Delhi: With the weak domestic demand, India’s dominant services sector expanded at its slowest pace in 17 months in June. Although the country’s inflation and gas shortages continued to pressure business activity, the sector remained firmly in expansion territory. Besides, hiring activities were broadly seen stagnant throughout the month, a private survey showed on Friday.
As per the survey, the seasonally adjusted HSBC India services purchasing managers’ index (PMI) fell to 57.4 in June, from 59.8 in May, registering the weakest upturn in 17 months, while the index stayed above the neutral mark of 50.0. “Several firms indicated that challenging market conditions and reduced client interest for their services dampened sales at their units, resulting in stagnant hiring activity and lower business confidence,” the survey said.
Commenting on the survey, Pranjul Bhandari, chief India economist at HSBC, said that India’s services PMI remained in expansionary territory but eased to 57.4 in June, the lowest reading in 17 months. “The loss of momentum points to more challenging market conditions and weaker demand, particularly at home,” Bhandari said.
However, the survey noted that export was seen as one area of strength in June, with firms seeing the strongest rise for three months. “According to panel members, the demand from clients in Australia, Belgium, Canada, Germany, Malaysia, Nepal, Oman, Qatar, Singapore, the UAE and the US improved,” it said.
Bhandari further said that external demand held up well as overseas sales stayed robust and growth reached a three-month high. On the prices front, the rate of inflation was slight, below its long-run average and the weakest since November 2025. “Price pressures also continued to cool, with both input cost and output charge inflation moderating as geopolitical disruptions in the Middle East began to subside,” Bhandari added.
On the job front, the survey showed that service providers generally found that payroll numbers were sufficient for current requirements and hiring was broadly paused. “Indian services firms foresee output growth in the coming 12 months, but the overall level of positive sentiment fell to a five-month low and was below the historical trend,” the survey noted.