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India's services sector picked up pace in April after a slight slowdown in March, according to the latest HSBC Services PMI data released by S&P Global.
The seasonally adjusted HSBC India Services PMI Business Activity Index rose to 58.7 in April, up from 58.5 in March. This suggests a sharp and stronger expansion in business activity. The latest reading is also higher than the long-run average of 54.2. It said "After experiencing a slowdown in March, growth of business activity in the Indian service sector accelerated slightly in April. This regained momentum was largely driven by a quicker increase in new order inflows, which also underpinned a faster expansion in employment". S&P Global noted that the improvement in services activity was largely driven by a strong rise in new business orders. This increase in demand was one of the best seen in the past eight months. Many firms credited favourable market conditions and effective marketing efforts for the rise in new work. Some companies also noted that efficiency gains helped them handle more business. It also added that on the pricing front, average charges increased at a quicker pace, despite cost pressures retreating to a six-month low. International demand also played a key role in supporting the sector's performance. Firms saw stronger demand for Indian services from regions such as Asia, Europe, the Middle East, and the United States. As a result, new export orders rose at the fastest pace since July 2024. The rise in new work led Indian services companies to expand their workforce. April marked the thirty-fifth consecutive month of job creation in the sector. The rate of hiring was also faster than that seen in March, showing companies' confidence in sustained demand. However, with business volumes growing, pressure on capacity also increased. There was a solid rise in unfinished work, indicating that many firms were operating close to their limits. Overall, April's PMI data signals renewed momentum in India's services sector, driven by rising domestic and international demand and supported by strong job creation. (ANI)
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