MUMBAI: Higher demand for both goods and services strengthened in June, with aggregate new business activity rising at the fastest pace since August 2024, driven by a record surge in international demand, says a private survey report.
The new PMI comes within days of the same survey reporting earlier this week that manufacturing sector activity rose to a 14-month high at 58.4 in June on the back of expansion in output, new orders, and job creation. The manufacturing PMI stood at 57.6 in May, 58.2 in April, and 58.1 in March.
Activity in the services sector, which accounts for over 65% of the gross domestic product, rose to a 10-month high of 60.4 in June, up from 58.8 in May. This growth was driven by higher sales, new orders, and an upturn in positive demand trends, according to the seasonally adjusted HSBC Services PMI index, compiled by S&P Global.
The agency said the PMI for June climbed to a 10-month high of 60.4, up from 58.8 in May, 58.7 in April, and 58.5 in March, and remained well above the 50-mark that indicates expansion.
The increase in export orders was among the strongest since the series began, while price pressures eased in June, with both input cost and output charge inflation softening compared to the previous month, the survey said on Thursday.
In June, new orders expanded at the fastest rate since August 2024, with services companies benefitting most from the continued strength of the domestic market, alongside a marked increase in new export business.
“The services PMI was up to a ten-month high, led by a sharp rise in new domestic orders,” said Pranjul Bhandari, chief economist at HSBC India. “Margins improved, as the rise in input costs was below that seen for output charges. Service providers remained optimistic about future growth, though their confidence faded a tad,” she added.
The composite PMI output index rose to 61 in June from 59.3 in May, indicating the fastest rate of expansion in 14 months. Growth quickened for both manufacturers and service providers.
Meanwhile, demand for both goods and services strengthened notably in June, with aggregate new business rising at the fastest pace since August 2024, driven by a record surge in international sales, the survey said.
However, despite an uptick in job creation among manufacturers, employment growth in the private sector softened, reflecting a slowdown among service providers. The overall rate of expansion, nevertheless, remained historically elevated.