India economy news: India’s April services growth at 5-month high amid mounting price pressures

India’s S&P Global PMI in the month of April stood at 57.9, up from 53.6 in March. Similarly, the composite PMI for the month of April too saw an uptick, from 54.3 in March to 57.6 in April.

Faster increases in both manufacturing production and services activity contributed to a stronger expansion in private sector output across India, data shows.

Anecdotal evidence indicated that output was boosted by higher bookings, the easing of pandemic-related restrictions, and favourable demand conditions, the firm said in a press release on Thursday.

“In isolation, the PMI data for the service sector were mostly encouraging, as surging demand underpinned quicker increases in new business inflows and output. Employment rose for the first time in five months, but the business sentiment was restrained by inflation concerns,” Pollyanna De Lima, Economics Associate Director at S&P Global said.

Data points to a resurgence in price pressures during April. Further, concerns around inflation restricted business confidence in April. The sharpest increase in input costs was noted in the consumer services sector, while charge inflation was most pronounced in transport, information & communication.

“Service providers reported having paid more for food, fuel and materials, with some mentions of higher wage costs also pushing up overall expenses. The overall rate of inflation quickened to the second-highest in the survey history, leading companies to hike their selling prices to the greatest extent in close to five years,” De Lima said.

Data showed that the international demand for Indian services worsened in April, a trend that has been recorded each month since the COVID-19 pandemic broke out in March 2020. New orders from abroad fell at a marked pace that was the quickest since September 2021, the firm said.