Daijiworld Media Network - New Delhi

New Delhi, Jul 3: India’s services sector posted its strongest performance in 10 months in June, driven by robust domestic demand and a sharp rise in export orders, according to the HSBC India Services Purchasing Managers’ Index (PMI) released on Thursday.

The seasonally adjusted PMI Business Activity Index, compiled by S&P Global, jumped to 60.4 in June from 58.8 in May, comfortably above the 50.0 threshold that separates expansion from contraction.

The survey highlights that new orders grew at the fastest pace since August 2024, with Indian service providers seeing solid momentum from both local customers and international markets. Export business was particularly strong from Asia, the Middle East, and the United States, the report noted.

This expansion translated into another month of job creation. Employment rose for the 37th consecutive month, with the pace of hiring exceeding the long-term average, although slower than May’s peak.

The cost pressures appeared to ease, with input cost inflation falling to a 10-month low and staying below historical averages. However, while the pace of output price inflation (prices charged to customers) slowed from May, it remained elevated compared to the trend average.

Pending workloads (outstanding business) increased slightly in June, at a quicker pace than the previous month, indicating continued capacity pressures.

Business sentiment remained positive, with 18% of companies anticipating higher output in the next year. Yet, this optimism marked the lowest level of confidence since mid-2022, pulling the overall confidence level below the long-run average.

Meanwhile, the broader HSBC India Composite PMI, which includes both manufacturing and services, rose to 61.0 in June from 59.3 in May — the strongest reading in 14 months. This comes on the back of faster growth in manufacturing activity, indicating broad-based momentum across India’s economy.