BANGALORE, Sept 3 Indian services activity
expanded at its weakest rate in three months in August as firms'
order books filled up at a slower pace, a business survey showed
The HSBC Services Purchasing Managers' Index (PMI)
, compiled by Markit, fell to 50.6 in August from
52.2 in July. A number above 50 denotes growth while anything
below implies contraction.
The new business sub-index fell to 51.9 from 52.6, a
Service firms were not alone in reporting lower order
volumes. Factory surveys on Monday showed new orders slowed for
companies across Asia and Europe as tensions between Russia and
Ukraine escalated and a patchy recovery in China.
India's services activity expanded for the first time in May
after shrinking for 10 months, right around the time Prime
Minister Narendra Modi's Bharatiya Janata Party scored a
landslide election victory that drove a wave of optimism.
That helped India's economy to grow at its fastest pace in
two-and-a-half years in the quarter to June, data released last
But Modi is yet to launch sweeping reforms aimed at pushing
the economy back to the double-digit growth rates of late
"Services activity is once again turning down following a
swift post-election uptick, suggesting that an improvement in
reform momentum is needed to lift sentiment in the sector,"
said Frederic Neumann, co-head of Asian economic research at
Firms' optimism about future activity, considered a good
gauge for growth, was at a near-year low and suggesting
inflation might cool both input prices and those paid by
customers rose at a slower pace, the survey showed.
(Reporting by Deepti Govind)