India's dominant services sector expanded at its slowest pace in 17 months in June as domestic demand weakened sharply and overall new business grew at its slowest rate in over two-and-a-half years, according to a survey that also showed hiring nearly stalling.
HSBC's India Services Purchasing Managers' Index (PMI), compiled by S&P Global, fell to 57.4 last month from May's 59.8, but was slightly higher than a preliminary estimate of 57.3. Readings above 50.0 indicate growth in activity.
"The loss of momentum points to more challenging market conditions and weaker demand, particularly at home," said Pranjul Bhandari, chief India economist at HSBC. New business - a key gauge of demand - rose at the slowest pace since November 2023.
International demand offered a partial offset with new export orders growing at their fastest pace in three months.
