India’s services sector growth eased in October, though it remained strong overall, supported by resilient demand and Goods and Services Tax (GST) relief. According to data released by S&P Global, the HSBC India Services Purchasing Managers’ Index (PMI) fell to 58.9 from 60.9 in September, indicating the slowest pace of expansion since May but staying well above the 50-mark that separates growth from contraction.
Firms surveyed said higher client footfall and GST relief continued to support activity, but competition and heavy rains limited growth momentum. Despite the moderation, the headline index remained comfortably above its long-run average of 54.3.
Pranjul Bhandari, chief India economist at HSBC, said, “India’s services PMI softened to 58.9 in October, which represented the slowest pace of expansion since May. Competitive pressures and heavy rains were cited as contributors to the sequential slowdown. That said, the services PMI is still running well above the neutral level of 50.0 and its long-run average.”
Input costs increased at the slowest rate in 14 months, which provided some relief for firms, he said. “Meanwhile, India’s composite PMI fell on a sequential basis from 61.0 in September to 60.4 last month, largely due to the slowdown in the services sector,” Bhandari added.
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