Services Activity Softens In September To 55.2 From The August 18-Month High Levels

As per a private survey data revealed on Tuesday (October 5, 2021), the country's service sector activity cooled off during the last month. Also at the same time business confidence weakened, nevertheless, hiring picked up for the first time in 10 months.

The seasonally-adjusted India Services Business Activity Index came in at 55.2 in September versus 18-month high figure of 56.7 logged in the previous month.

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Service providers in the country are facing an increase in average cost amid rise in fuel, material, transportation and retail prices. On an overall basis, inflation in the country declined to an eight-month low. As per the report, evidence provides that optimism is not picking pace owing to worries around inflation.

"Companies still have spare capacity to accommodate for rising sales and hint that the recovery in employment is by no means guaranteed to continued," said Pollyanna De Lima, Economics Associate Director at IHS Markit.

Last week, the data released on manufacturing growth suggested that the manufacturing activity in the country expanded for the third straight month.
Combined together, the Composite PMI Output Index was at 55.3 in September.

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