The Nikkei Services PMI stood at 50.3 in February as compared to 48.7 in January.
Mumbai: The growth in India’s services sector rebounded in February, the first time since October 2016 as businesses recovered from the demonetisation related disruptions seen in each of the previous three months, a survey showed on Friday.
The Nikkei India Services Purchasing Managers India (PMI), which measures growth in the domestic service sector scaled above the crucial 50 level mark after slumping to a near three year low in November 2016. The Nikkei Services PMI stood at 50.3 in February as compared to 48.7 in January.
While incoming new business picked up in February led by a turnaround in financial intermediation services, the survey noted that the pace of growth in new work was marginal.
However, survey participants remained less optimistic about the 12-month outlook for services activity amidst increase in competition.
Pollyanna De Lima, economist at IHS Markit, and author of the report feels it is too early to conclude that expansion rates would climb to their trend levels in the near term.
“With demand conditions strengthening in India, new business inflows rose in both manufacturing and service sectors, leading to the first increases in private sector new work and output since October 2016. But, companies remain reluctant to take on additional staff and confidence towards the 12-month outlook for output dipped to its second-lowest mark in over one year,” she said.
