2024.01.0505:44:00UTC+00India Services Growth Quickens In December

India's service sector expanded at an accelerated pace in December as demand buoyancy flourished sales and business activity, survey data from S&P Global showed on Friday.

The services purchasing managers' index rose to 59.0 in December from 56.9 in November. A score above 50 indicates expansion in the sector.

Both output and new orders grew at the fastest pace in three months. Positive demand trends and favorable economic conditions were the main factors driving output growth in December.

Foreign orders showed a further increase in December, driven by higher demand from clients based in Australia, Canada, Europe, the Middle East, and South America. Nonetheless, the rate of growth was the slowest since June.

The rate of employment in India's service sector was faster than in November, while signaled mild pressure on the capacity of Indian service companies as outstanding business rose slightly.

On the price front, input price inflation eased to the lowest level in December, while a slight rise was seen in charge inflation.

Indian service companies anticipate that the robust demand momentum will carry forward to 2024, which, coupled with advertising and better customer relationships, will underpin upbeat forecasts for output.

The composite output index rose to 58.5 in December from 57.4 in November, indicating the sharpest rise in private sector activity across India for a year. The acceleration was underpinned by faster growth in the service economy, as factory production rose at the slowest pace in 14 months.