India's private sector services growth slowdowns in Sept
The seasonally adjusted Nikkei India Composite PMI Output Index fell from August’s 42-month high of 54.6 to 52.4 in September.
The health of the Indian private sector economy improved in September, but to a lesser extent than in August. Output and new business increased at softer rates in both the manufacturing and service sectors. Meanwhile, prices charged were raised in line with higher cost burdens.
Growth in India's manufacturing and services sector slowed down in September, Nikkei's IHS Markit said on Wednesday.
The seasonally adjusted Nikkei India Composite PMI Output Index fell from August’s 42-month high of 54.6 to 52.4 in September. "The latest above-50.0 reading was the fifteenth in as many months, highlighting ongoing growth in the country," Markit said, adding, "The headline seasonally adjusted Nikkei India Services Business Activity Index registered 52.0 in September. Down from August’s 43-month high of 54.7, the latest reading pointed to a slower rate of expansion that was moderate overall."
Pollyanna De Lima, economist at IHS Markit, and author of the report, said, “Service sector performance in India continued to improve relatively modestly in September, a trend that has been evident throughout the year-to-date. With manufacturing also on a softer footing, growth of private sector output and new orders eased in the latest month."
Over Q2 FY2016/17, however, the PMI Composite Output Index posted its highest reading since the Jan-Mar 2015 quarter, thereby suggesting a pick-up in GDP growth.
“The ongoing upturn in new work combined with muted employment growth led backlogs of work across the private sector to increase at the quickest pace in nearly two-and-a-half years. As a result of this, businesses may be more willing to take on additional workers as we head to the year end. “Food and petrol prices continued to climb in September, which placed pressure on operating costs. In response, private sector companies raised their own prices for the second straight month, although inflation remained relatively soft,” De Lima said.
The level of new business placed with Indian services firms increased moderately in September, following a solid rise in August, the report further said.