India’s service sector activity level was at the the highest in four months in August, survey results from IHS Markit showed Thursday.
The IHS Markit services Purchasing Managers’ Index rose to 41.8 in August from 34.2 in July.
The reading was the highest since March, before the escalation of the global COVID-19 pandemic.
Any score below 50 indicates contraction in the sector.
Output declined further in August with the rate of contraction solid overall and new [business][1] fell for the sixth month in a row with the rate of decline steepest since September 2014.
Employment decreased for the sixth straight month in August, albeit at a slower pace.
On the price front, cost burden increased for the second straight month in August and the rate of input price inflation was faster. Output prices rose marginally.
Sentiment for the next 12-months remained neutral in August after being negative in the previous three months.
The survey showed that the composite output index, which measures combined services and manufacturing output, rose to 46.0 in August from 37.2 in the prior month.
“Sustained periods of closure and ongoing lockdown restrictions in both domestic and foreign [markets][2] have weighed heavily on the health of the industry,” Shreeya Patel, economist at IHS Markit, said.
“Backlogs of work accumulated to the greatest extent in almost 15 years of data collection,” Patel said.
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