Services growth slows in September on poor demand: Nikkei PMI

NEW DELHI: Services activity moderated in September because of weaker demand, a private survey showed, pointing to a broad-based slowdown in economic activity after a parallel survey showed decline in manufacturing as well.

The Nikkei Services Purchasing Managers' Index (PMI) dropped to 51.3 in September from 51.8, findings released on Tuesday showed. Areading of more than 50 on this survey-based index shows expansion. This is the third consecutive month of expansion in services. The composite PMI, which captures activity in both manufacturing and services sector, eased to 51.5 in September from 52.6 in August.

“India’s economy lost steam in September, with growth fading across both the manufacturing and service sectors,” said Pollyanna De Lima, economist at Markit, which compiles the survey. “The sluggish increase in private sector output mirrored softer demand conditions across the country, while growth of global demand for Indian goods also moderated.”

The survey showed incoming new work at service providers rose for the third month in succession during September, but the rate of expansion eased from the previous month. In view of slower pace of work, companies did not step up hiring. Input cost pressures on service providers eased for the first time in 10 months. “With purchase prices also falling at manufacturers, overall input costs across the private sector as a whole declined for the first time in six-and-a-half years,” the survey noted.